Oral Answers to Questions

CULTURE, MEDIA AND SPORT

The Secretary of State was asked—

Sports Action Zones

Simon Hughes: What assessment she has made of the effectiveness of sports action zones; and if she will make a statement.

Richard Caborn: An initial evaluation relating to the establishment of the 12 zones was conducted by Sport England in 2001. Further evaluations were conducted in 2002–03 and 2003–04. A summary of the findings of the most recent evaluation will be published by Sport England this summer.
	The work in all the zones shows, in varying ways, that   sport has made a major contribution to dealing with some of our problems in promoting health, the integration of ethnic minority groups, crime reduction and social exclusion. We expect the good practice to go into the mainstream work of developing the sports infrastructure.

Simon Hughes: Our hon. Friend the Member for Vauxhall (Kate Hoey) chairs with me our sports action   zone in Lambeth and Southwark, which is brilliantly led by Brian Dickens, and we have experienced huge success in that zone in our two boroughs. Will there be an opportunity in the near future, whoever is in government, to roll out the zone across the rest of our boroughs so that the benefits spread? The Minister gave a list of lessons learned, including access, participation, health and social inclusion. Will there also be an opportunity to share with the rest of the country the lessons that boroughs such as ours have learned?

Richard Caborn: Very much so. I thank and congratulate my hon. Friend the Member for Vauxhall (Kate Hoey) and the hon. Gentleman on their work in the action zone. We are rolling out a further 18 zones and I hope that, as the hon. Gentleman says, the genuine good practice and innovation that stem from them will now fit into the actions of regional sports boards in developing their strategies. They involve health, social inclusion, education and the development of sustainable communities, and the zones can play an important role in that.

Kate Hoey: The Minister should be aware that one of the lessons from the sports action zones is that a bottom-up, not a top-down approach works. When the approach in our area was top down for the first two years, with Sport England trying to run it, it did not work. When it was bottom up, with genuine neighbourhood support from community groups, the South Bank employers group and all the people who lived there and knew what they needed, it worked. Does the Minister agree that it is important that the funding continues and is not diluted in a London sports board, thus getting broken up and not necessarily used for inner-city areas such as mine?

Richard Caborn: Well, I do not know about the last part of the question—[Interruption.] Bear with me. Sports boards are charged with targets of greater participation. I remind my hon. Friend that, when I came into the job, Sport England was passing down 98 different sports initiatives to the regions. There was no bottom-up process; it was a case of ticking boxes and getting the dosh without anybody measuring what was happening. That approach has changed significantly in the sports boards, which bring in health, social inclusion and business to ensure that they drive up participation and   also target the least well off in our society. I hope that, in the next few years, we will tackle the issues that my hon. Friend raised and use sports action zones in doing that.

Nick Hawkins: The Minister knows that I will always be happy to welcome   more money for sport anywhere in the country. I recognise, as the hon. Member for Vauxhall (Kate Hoey) did, that there are good areas where the approach in the sports action zones has been bottom up. However, does the Minister recognise that, in some parts of the country, there are still complaints that the money is not getting to the sharp end and that too much is being spent on bureaucracy? Does he acknowledge that, in any further development of the sports action zone programme, the Government need to be especially careful to ensure that taxpayers' money going to sport reaches children in disadvantaged areas and is thus spent on sport, not administrators?

Richard Caborn: Very much so. The hon. Gentleman knows that Sport England's employees have reduced from 600 to a little more than 200. There is much going into the regions and the county sports partnerships. I   suggest that he has a quick word with his Front Benchers, because the plans for sport that they will present at the next election appear centralist by any stretch of the imagination. Indeed, they would scrap everything except the Minister for Sport.

Geoffrey Robinson: Is my right hon. Friend aware that the city of Coventry was honoured by his visit last month to see the new Coventry arena? He is to be congratulated on seeing the project through from inception to realisation this year. Does he realise that it stands as a model for the country and shows how sporting facilities, zones and new arenas can contribute to the regeneration of a city and, indeed, a region?

Richard Caborn: That is absolutely true. Anyone would think that there was an election in the air, but I could not possibly comment on that. The project to which my hon. Friend refers is extremely good for regeneration. It has taken a long time getting there, but I have had the privilege of going to see the development to date, and I   am sure that it will have a major and much-needed impact on Coventry's economy, in terms of how it can diversify using sport and other activities.

Tourism Deficit

Adrian Sanders: If she will make   a statement on the UK tourism deficit.

Richard Caborn: The UK's tourism deficit was £17.3 billion in   2004. National tourism deficits in the developed world reflect various factors, including rising prosperity.   By way of illustration, Germany's deficit stood at £27.1 billion in 2003. Of more importance is   our   industry's impressive domestic and inbound performance, with a record £12.8 billion spent by 27.5 million overseas visitors last year. That illustrates a rising trend.

Adrian Sanders: Does the Minister agree that a way of dramatically reducing the tourism deficit would be to introduce an aviation tax, because Brits spend far more overseas than is spent by overseas visitors to the United Kingdom?

Richard Caborn: The hon. Gentleman will know that tax is a matter for the Treasury. However, the industry has been working with my Department recently to address the structural weaknesses in tourism. We have now moved tourism into the regional development agencies, where it is seen as a major economic driver, especially in the south-west, as the hon. Gentleman will appreciate, as he comes from Torbay, where RDA money has already been invested. I hope that that trend will continue. This is about identifying skills and quality, developing EnglandNet, and having sound data on which to base decisions for the future. It is also about addressing structural weaknesses, and the industry and the Government are now working together in a strong partnership to do that.

Kevan Jones: My right hon. Friend recognised the importance of the regions in   promoting tourism. Will he congratulate One NorthEast and the North East Tourism Advisory Board, of which I am a member, on the production of their recent strategy for the north-east? It is not just about promoting the wonderful attractions and beauty of the north-east of England, but about ensuring that tourism plays a key part in the revival of the economy there.

Richard Caborn: Very much so. I congratulate my hon. Friend on what has been done in that regard. There is no doubt that creating a new structure for tourism in the north-east has had a difficult start, but I am sure that a solution has now been found that is acceptable to all parties and that will drive tourism forward as part of the region's economy development strategy. I look forward to seeing further developments in the area.

Robert Key: We could do with more visitors to south Wiltshire. Twenty-one years ago, I attended the birth of English Heritage, whose first priority was to be Stonehenge. Eight years ago, a Select Committee described the facilities at Stonehenge as a national disgrace, and eight years ago in July, the Prime Minister said that the Government would do their best to put that right. All that time has passed, but we have nothing to show for it. We know that the inspector's report on the tunnel is now with Ministers, but will the Minister give us an assurance that Stonehenge remains a priority for his Department as well as for the Government as a whole? What can I do to help the   Minister in this regard?

Richard Caborn: It is not often that I get an offer like that. We are waiting for the report that the hon. Gentleman mentioned, and it will go to the Department for Transport. I accept that this has gone on for far too long. All that I can say on behalf of my Department and of English Heritage is that this matter is a priority andthat we want to see things happen. So the sooner we get the report, and the sooner that decisions are made by the Department for Transport, the better.

Andrew MacKinlay: Will the Minister hold discussions with the Secretary of State for Northern Ireland, bearing in mind the very wrong perceptions that people overseas—particularly in north America—have of banks being robbed there and of crime in urban environments? In fact, Northern Ireland is one of the most attractive and peaceful parts not only of the United Kingdom but of western Europe, with the hills of Antrim, the lochs of County Down, and the   Sperrins. Could not the British Government do more to promote interest in and awareness of Northern Ireland, rather than seeing so many people being attracted to Ireland via Dublin?

Richard Caborn: That question is timely, because later this week I shall be meeting Ministers and other representatives from the four devolved authorities, and I shall make sure that my hon. Friend's point is conveyed to them. There is no doubt that Northern Ireland is a beautiful place, and it is unfortunate that the worst events are sometimes disproportionately reported in the press, while the best things are left out. I shall convey my hon. Friend's sentiments to the people responsible for these matters in Northern Ireland.

Malcolm Moss: As the Minister confirmed in an answer a few moments ago, the Government can accurately measure the tourism deficit and take steps to narrow the gap only if they have reliable statistics or sound data. Given that the Secretary of State, after the Hartwell meetings, made better statistics a priority—a fact later confirmed by the Government's policy document "Tomorrow's Tourism Today"—and that the Department of Trade and Industry's science review of DCMS last year said that only if DCMS implemented the tourism statistics improvement initiative's findings would the statistical base be accurate and reliable, why are the Government continuing their miserly approach and turning their back on the needs of the tourism industry by denying funding for TSII?

Richard Caborn: That would be absolutely wrong. As the hon. Gentleman knows, because we held a conference a   few weeks ago in Birmingham, the industry has acknowledged very clearly to us that we are sitting down with it in the implementation group, which I chair. We are addressing, probably for the first time in a long time, the real structural weaknesses. Data are one of those, but not the only one. We are looking very seriously at those structural weaknesses and driving that agenda for change—not just in the industry, but through the development agencies, with which there is now a very strong partnership. Data are part of that and we are acting on the issue. As the hon. Gentleman knows, I said in an answer that we will produce those data in the not-too-distant future.
	This is one of a number of issues that we are considering in terms of ensuring that the industry is fit for purpose and can achieve the objective, which is to increase its worth from £74 billion to £100 billion by 2010. That is achievable, it will mean a lot more jobs and those data are important to achieving it.

Listed Buildings

Sydney Chapman: What recent meetings she has had with English Heritage concerning the listed buildings regime.

Tessa Jowell: I have particular pleasure in answering a question from the hon. Gentleman at what might be his last appearance at DCMS questions.
	As part of the regular meetings with the chair of English Heritage, we have discussed progress on the current heritage protection review. Some of those discussions have referred to the changes to the listed building regime, which is due to be implemented next month.

Sydney Chapman: I am delighted to hear the right hon. Lady's response to my question, because she knows that, in certain parts of the fourth estate recently, there was speculation that her Department would not hand over the powers of the listed building system to English Heritage next month. Now that she has confirmed that she will be doing so, may I congratulate her and say that   I have such confidence in English Heritage that even if she handed over the designation orders as well, I   would be pleased?

Tessa Jowell: As the hon. Gentleman knows, a number of administrative transfers will take place next month, but, as part of upgrading and modernising the   designation system, which is rather dense and impenetrable for many local residents, we intend to go further. We hope to publish those proposals in a White Paper later this year or early next, and they would have to be followed by legislation, but we consider the administrative changes that will take place next month a first step.

Derek Wyatt: This year is the 200th anniversary of Trafalgar. As we have such a rich maritime history, can I persuade my right hon. Friend to ask English Heritage to list not just buildings, but our great ships, as it used to, so that they do not sink?

Tessa Jowell: That is an interesting proposal from my hon. Friend—one that I will certainly ask English Heritage to consider and provide advice on.

John Hayes: Has the Secretary of State calculated how many listed buildings will be affected and how many lost due to the Deputy Prime Minister's plans to bulldoze the north and concrete over the south? She is aware that those plans will do a great deal of damage to a number of historic settlements, including a number of listed buildings. Will she make such an assessment and bring it to the House, and will she give the House a chance to debate and overturn these disastrous plans?

Tessa Jowell: We have just heard from the Opposition—it is not surprising—another myth that has no basis in fact. We have a strong and robust heritage protection system, which I intend should become more flexible and more susceptible to public involvement. There is no question of the need for new homes, which are desperately needed in the south of England, being compromised in the way the hon. Gentleman suggests. He is simply making a rather cheap, party political point.

Andrew Miller: I am extremely grateful for the work that English Heritage is doing in the north-west, particularly in supporting work in my constituency to look after the grade II* listed buildings on the Hooton aerodrome? One of the problems that has emerged is the shortage of money to repair buildings, and the resultant tendency for preference to be given to grand mansions rather than our industrial heritage. Can my right hon. Friend use her Department's offices to work with English Heritage to try to gear in private sector money to help buildings for which alternative uses could be found to succeed in the future?

Tessa Jowell: Yes, that is a very good proposition, and one which English Heritage has been applying in   different parts of the country. Notable buildings, which fall under the auspices of English Heritage or the   National Trust, can often make an important contribution to modern regeneration, which is one of the important objectives. There are many examples of   that. I therefore welcome my hon. Friend's suggestion.

Peter Bottomley: If the right hon. Lady anticipates the election, in the light of her remarks to my hon. Friend the Member for Chipping Barnet (Sir Sydney Chapman), can we anticipate the result and say that we will bring a fresh mind to the question of whether there should be new legislation? We do not want too much modernisation of the protection of our ancient buildings.

Tessa Jowell: We have many fresh and vigorous minds on this side of the House ready to be applied to the next stage of heritage protection.

John Whittingdale: Following up the question from my   hon. Friend the Member for Worthing, West (Peter   Bottomley), may I say what a pleasure it is to be asking the Secretary of State a question on what might be the last occasion that she answers from the Dispatch Box? However, will she confirm that more than 1,000 grade I and grade II* listed buildings are currently on the at-risk register, and one in six of those are owned by the Government or by local authorities? How will those be helped by the £14 million cut in the budget of   English Heritage announced recently by her Department, coming on top of the £19 million cut in the previous spending review? Is it any wonder that English Heritage has said that her Department has no regard for the heritage's contribution to people's quality of life or to the economy? Will she now match our pledge to guarantee the future of the heritage lottery fund, and to   boost it by an extra £100 million a year?

Tessa Jowell: Let me take the hon. Gentleman's intervention point by point. First, it does not square with the many discussions that I have had with English Heritage. The figures that he quotes do not take account of the fact that this spending round saw English Heritage gain an additional £13 million. Will he welcome the increases that, in this tough spending round, we were able to establish for the museums sector, and the above-inflation increase for most of our regularly funded arts organisations? In relation to English Heritage and the heritage sector more generally, I pay tribute to the fact that it has saved money by tackling bureaucracy and inefficiency, which has now been translated into what would be described as front-line activity. I hope that that process will continue.

Art Market

David Heathcoat-Amory: What steps she is taking to promote the UK art market.

Estelle Morris: The Government support the UK art market in a number of ways. Our policy of free admissions to national art galleries and museums has substantially increased public access to contemporary and non-contemporary art, and raised awareness and interest in the visual arts. The own art scheme, administered by the Arts Council, is directly supporting the art market by enabling the general public to buy art through interest-free loans.

David Heathcoat-Amory: Is the right hon. Lady aware of the damage that will be caused by the implementation in January next year of the directive on the artist's resale levy, which will drive art sales out of this country to centres such as New York which do not impose the levy? Given that the European Commission never carried outa regulatory impact assessment, given that the Government's own assessment concluded that 1,000 jobs would be lost as a result of the directive and given that—to be fair—the Government voted against the original directive, will she demand an urgent re-examination of this further example of job-destroying European regulations?

Estelle Morris: The right hon. Gentleman is correct in saying that the Government have argued vociferously in Europe about the droit de suite. We should bear in mind, however, that the art market is tremendously strong in the United Kingdom at present. It is worth £4.2 billion to the economy, so I do not think that it is vulnerable or weak.
	Let us be clear about what this measure will mean. It will mean that artists or—for 70 years after their deaths—their successors will have a share of the resale value of any work of art that goes to the British art market. Given that art inflation is significantly above general inflation, I suppose there is an argument that those who produce works of art should have a fair share of the profit; but we have always felt that it would have been better for us not to be party to this measure, and have argued to that effect as vociferously as possible.
	I think the right hon. Gentleman would have to admit that the art market has recognised the work that the Government have done. We will continue to defend, in a number of ways, a market which, as I have said, is incredibly strong at present—probably far stronger than it was when the right hon. Gentleman's party was in government.

Tony Banks: Droit de suite may be a good idea in principle, but would it not be better for the levy thus raised to be spent on promoting the arts generally, rather than going to the families of artists—some of whom will take ages to trace, and may be incredibly wealthy themselves?

Estelle Morris: That may be so. I do not know how easy it would be, but as my hon. Friend knows, that is not part of the proposal. We are currently consulting on the details, a process led by my noble Friend the Minister for Science and Innovation. I am sure that he will read my hon. Friend's comments and reflect on them, but I do not want to give the impression that Europe will be swayed. The motive behind the proposal is to ensure that the person who produces a work of art has a share of the income when it is sold, sometimes at an immeasurably higher price in a relatively short period.

Richard Allan: As the Minister will know, in 2003 very strict regulations were imposed on the UK art market to implement United Nations sanctions banning dealing in material that might have been looted from Iraq. The regulations have now been in force for some time. Has the Minister made, or will she make, an assessment of their effectiveness and their impact on the UK art market?

Estelle Morris: I am aware of the huge amount of work that the hon. Gentleman has done in this regard, and of his part in the enactment of the legislation. We have not yet made a valuation, but I will ask whether this is an appropriate time for us to do so. Once the legislation has had time to settle down, we can establish what has happened. I entirely agree that a valuation ought to be made at some point.

Libraries (Funding)

Linda Perham: if she will establish a standards fund to provide capital for library buildings, books and information and communication technologies.

Tessa Jowell: I welcome the Select Committee's report on public libraries. I share many of the concerns about the current state of the library service, of which I know my hon. Friend has been a long-standing advocate. There is an unacceptable variation in the extent to which they are resourced to be a local service for knowledge, discovery, information and reading. The quality of books is a key factor in the appeal of a library, and we   are currently considering—along with local authorities—how efficiency in the purchasing of books, yielding more money with which to buy them, can be achieved.

Linda Perham: The Select Committee report also drew attention to the condition of public library buildings. Would my right hon. Friend consider establishing a partnership fund between national and local government and the lottery to secure investment in improving those buildings?

Tessa Jowell: We have made the issuing of private finance initiative credit for the improvement of the library service a priority. My hon. Friend is right: the   quality of a building has a major impact on the level of use. I commend the London borough of Tower Hamlets, which has taken some imaginative steps through partnership to develop modern, beautifully designed libraries. As a result, library use has increased in a deprived borough.

Licensing Act 2003

Andrew Selous: If she will make a statement on the implementation of the Licensing Act 2003 as it affects community and village halls.

Tessa Jowell: Community and village halls that wish to provide entertainment or to sell alcohol will now be able to do so with a single licence, and with no additional cost for permission to carry out the wide range of activities that they might want to provide.

Andrew Selous: Will the Secretary of State act before this November to prevent the widespread damage that the Licensing Act 2003 is expected to cause to our 19,000 community and village halls across the country? In particular, the role of the designated premises supervisor is far too onerous to expect volunteers to take it on. Will the Secretary of State instead consider awarding a comprehensive premises licence at no, or very low, cost to these halls? After all, it is not as if community and village halls have been hotbeds of antisocial behaviour in the past.

Tessa Jowell: No, we are certainly not going to put this legislation into reverse; it is on the statute book and we are implementing it. We are discussing with Action with Communities in Rural England some of the points that the hon. Gentleman raises, but he should be aware   that during this legislation's parliamentary stages, village halls were made exempt from licence charges except where they wish to serve alcohol. As he knows, they can certainly apply for temporary event notices should they choose to do so—

Andrew Selous: Twelve times a year.

Tessa Jowell: Yes, exactly—they can apply 12 times a year, but only the police have a right of appeal against a   temporary event notice. We on the Labour Benches regard the involvement of local communities and the upholding of local residents' rights as an important part of this legislation, along with curbing precisely the risk of antisocial behaviour—not necessarily from village halls—that the hon. Gentleman refers to.

Owen Paterson: That was a most complacent reply, which showed a complete lack of understanding of the value of village halls, particularly in isolated rural areas. Putting village halls   on the same level as commercial premises—the Act's basis—is utterly absurd. The Secretary of State says that she is talking to the industry's representatives; will she publish the results of those discussions as soon as possible? I have received not a single letter from anyone running any of my village halls stating that they want this interfering new regulation.

Tessa Jowell: What I just said is that we are discussing with ACRE—the body that represents village halls—the implementation of the 2003 Act. It is as important to local communities in rural areas as it is to those in urban areas that their peace and the quiet enjoyment of their homes be safeguarded. We shall ensure that the application of the licensing regime through the local authorities is proportionate. Indeed, that is why the burden on village halls in that regard is much less than on city centre pubs, as it should be.

Archaeology

Hugh Bayley: What steps her Department is taking to promote public interest in archaeology.

Estelle Morris: The Government are fully committed to increasing public interest and participation in all aspects of the historical environment, including archaeology. As a result of the recent spending review, £2.5 million has been allocated to the portable antiquities scheme.

Hugh Bayley: National and amateur archaeologists will warmly welcome the Government's new funding for the portable antiquities scheme. Heritage comes alive and becomes meaningful to most people when it is local and relates to their own neighbourhood. The Council for British Archaeology, which is based in York, is concerned about the proposed changes to English Heritage's education service. Can the Minister assure me that the Government will maintain support for local and regional education in heritage and archaeology?

Estelle Morris: Yes; my hon. Friend has a particular interest in this issue, given his constituency, and I pay tribute to the work that he does. There is no doubt that English Heritage has re-organised its education service in the past few years. Change is always unsettling and leads to some lack of certainty, but I am pleased to say that the money that English Heritage is putting into education has increased. Indeed, a lot of money has gone into front-line services, so that more people with different skills are working with children. In addition, and as my hon. Friend knows, our Department and the   Department for Education and Skills have been working closely with English Heritage to ensure that the quality and shape of its education service is as effective as it can be. I suspect that, over the next few years, as the new proposals bed down, my hon. Friend will see education services in his constituency, and, indeed, throughout the country, improving in quality.

Don Foster: I welcome the Government's decision to fund the portable antiquities scheme, which is crucial for the 95 per cent. of finds that are not covered by the Treasure Act 1996. Is the Minister aware that the hon. Member for City of York (Hugh Bayley), who raised the question, is a member of   the all-party archaeology group, which made recommendations to establish a cross-departmental committee at ministerial level to examine archaeological issues? Her Department alone cannot cover them all, so does she agree that it is important to establish such a committee, and that one of its first priorities should be to investigate the proposals to scrap the GCSE in archaeology?

Estelle Morris: I am grateful to the hon. Gentleman for his comments on the portable antiquities scheme. The security of funding for it over the next three years has been welcomed by all. I take his point about the need to ensure that Departments work closely together, and I would not deny that archaeology spans a number of different Departments. Ensuring seamless support for it   is sometimes difficult, but I hesitate to commit the matter to a committee. What inevitably ends up happening is that more time is spent servicing and organising the committee than on carrying out work on archaeology itself.
	I would not want to go as far as establishing a committee, but I can give an assurance that I shall keep an eye on how the different Departments are working, as they are not working as well on this matter as they should. I have asked my officials to ensure that, in the months ahead, they monitor how archaeological issues are tackled. If it appears that appointing a committee is the most appropriate way of making progress, I would have no problem supporting it, but I am not convinced at this stage that that would be the best way forward.

Junior Football and Rugby

Huw Edwards: What support her Department gives to junior football and rugby.

Richard Caborn: As part of our national strategy for physical exercise, school sport and club links, the Football Association and the Rugby Football Union are receiving a little more than £750,000 each to allow them to build sustainable high-quality links between school sport partnerships and accredited clubs. In addition, on   the football side, the Football Foundation has supported projects worth a little less than £300 million, with support from the FA Premier League, the FA and Sport England.

Huw Edwards: Does the Minister share my pleasure and admiration when he sees hundreds of young people playing football or rugby in different parts of our constituencies? Those games are supervised by coaches and there are facilities that were just not available when my generation was playing football some time ago. Does he appreciate that those who administer junior rugby and football often incur considerable costs, especially travelling away from home and in respect of logistical problems? Any help that the Minister's Department and the equivalent in Wales could give would be gratefully appreciated. Finally, will he join me in congratulating—

Mr. Speaker: Order. There are far too many questions there.

Richard Caborn: Thank you for that protection, Mr.   Speaker. My hon. Friend knows that our commitment to two hours of quality physical activity and sport for every child, every week from the age of five   to 16 is probably one of the biggest investment programmes in school sport that there has ever been—[Hon. Members: "A grand slam"]—and it has to be added to the £60 million investment going out to various governing bodies to develop club to school links, which is another major investment. [Hon. Members: "Another grand slam."] My hon. Friend is absolutely right about the welcome for the new coach's certificate. It is the first time that all governing bodies have signed up to a national coaching certificate that is providing some of the quality coaches that we need. I do not want to go on too long, Mr. Speaker, but I want to say that when I first took up this job, no national sport was headed by a British coach, which was an indictment of our coaching system. I hope that we can continue to change it in the years to come.

Bob Russell: While I welcome the figures that the Minister mentioned about grass-roots football, does he agree that the sums of money in the   highest reaches of professional football are so substantial that more should be done to draw it down through the lower leagues and into grass-roots and school football?

Hon. Members: Grand Slam!

Richard Caborn: I would agree with the hon. Gentleman, but remind him that the distribution of money out of the premier leagues in English football is as good as any in Europe. That does not mean that it is good enough, but the European leagues have not invested £20 million as the Football Foundation, the FA and the Government have done. We are talking about £60 million each year going into grass-roots sports via those three sources of   funding. The premier division is playing for success   and has developed community programmes. The contribution is therefore considerable. It could do better—that is for sure—but I must commend what has been done to date as probably the best contribution in Europe.

Tony McWalter: But does my right hon. Friend accept that the sum of money he has told the House about is inadequate to deal with the needs, say, of my local rugby union football club, Camelot, which runs women's and girls' teams as well as men's teams? The links to schools are not necessarily strong in some areas, so it is important that people's struggle to provide flourishing facilities is given more support than my right hon. Friend has currently been able to announce.

Richard Caborn: A number of my hon. Friends have asked me from a sedentary position to congratulate the Welsh on the grand slam, which I do. The team played some fantastic rugby not only in the final, but also in the games running up to it—[Hon. Members: "Hear, hear."] I hope that satisfies my hon. Friends.
	What my hon. Friend the Member for Hemel Hempstead (Mr. McWalter) said is absolutely true, but I   suggest that investment in sport, which deals with social inclusion, health and education in our communities, will continue. There is no doubt about that and I hope that some of the issues raised by my hon. Friend will be addressed; but we are changing the whole structure of the sport so that there is more participation and more of a bottom-up approach, as hon. Members on both sides of the House have said. That is what the   regional boards are starting to deliver through the county partnerships.

Hugh Robertson: Many people in both the Football Association and the   RFU would say that the greatest support that the Department can give both junior football and junior rugby would be to help the clubs by reducing bureaucracy. The Minister himself clearly agrees. On Friday, he said that Labour had listened to the concerns of front-line staff about too much bureaucracy. If that is to be anything more than just more talk, will the Minister tell the House exactly which organisations he intends to reduce or axe altogether?

Richard Caborn: May I welcome the hon. Gentleman to the Front Bench as the Opposition spokesman for sport and tourism? It must have been quite a shock for his   Front-Bench colleagues. The previous spokesman announced their manifesto on a Friday, was criticised on the Sunday and walked away on the Monday. Probably the reason he walked away was centralisation. The hon. Gentleman talked about bureaucracy. All the Opposition want to do is to bring sport back to a Ministry of sport. That is their recommendation. We have been removing bureaucracy from the system, as I   have already said. The number of employees at Sport England went down from more than 600 to 200. We have streamlined the whole regional structure and most of the governing bodies accept that.

Heritage Lottery Fund

Tim Boswell: How much has been distributed by the Heritage Lottery Fund in each year since 2000.

Estelle Morris: The Heritage Lottery Fund has awarded the following amounts in each financial year from 2000–01 until 31 January 2005: £326.6 million, £350.7 million, £367.2 million, £341.1 million and £268.1 million.

Tim Boswell: Does the Minister accept that there is a degree of discomfort about the apparent cut both in support from the lottery, by the diversion of funds for   other purposes, and in the core grant to English Heritage? Is it not time that Ministers abandoned their preconception that the heritage is the private fiefdom of the privileged and understood the important economic and social contribution that it makes, as well as its contribution to our history and the fact that it is actively enjoyed by people of all walks of life?

Estelle Morris: The hon. Gentleman fails to see that since the Labour party has been in power more people, from a wider range of backgrounds, have accessed heritage than ever before. There has been no diversion of funds from the Heritage Lottery Fund to other purposes. The percentage is clearly set out and agreed by the House, and we have kept to it. Furthermore, the hon. Gentleman should consider what the HLF money has been spent on; there have been a number of education and widening access projects. Indeed, the HLF has managed to preserve the heritage of our country and to ensure that more people have access to it. That is a record of which to be proud and I am happy to congratulate the HLF on it.

Chris Bryant: The Minister will know that there has been much talk of a bid to the Heritage Lottery Fund from commercial west end theatre owners to try to refurbish some of the most beautiful buildings that we have in London, which are one of the major reasons why many tourists come to this country. Does she believe that it would be suitable to give £125 million to bring those theatres into the modern era, so long as we can ensure transparency in how that money is spent and decent access for ordinary people to go to those theatres?

Estelle Morris: I accept that money needs to be spent on the west end theatres, which bring a lot of money to the capital, and theatres throughout the country. I   accept that something needs to be done. My hon. Friend will be aware of the difficulties of giving lottery money to the private sector, but I have made sure that those involved are working together and I know that the west end theatres will put in a bid. It is up to the Heritage Lottery Fund and, indeed, the Arts Council, to which they have also put in a bid, to respond. If they respond favourably, no doubt they will make sure that mechanisms are in place to ensure that the money is   properly spent, but that is a matter not for the Government but for the appropriate lottery boards.

Hugo Swire: My hon. Friend the Member for Daventry (Mr. Boswell) is right: the Heritage Lottery Fund has lost out enormously since the New Opportunities Fund was created in 1998 to supplement health and education spending. In fact, I   can give the exact figure: £800 million. Will the Minister give an assurance, as the Conservative party has, that Britain's heritage will continue to be a major recipient of lottery funds after the current licences expire in 2009? Does she not agree that it is time to take the Government's hand out of the lottery till?

Estelle Morris: The hon. Gentleman should know that, last Thursday, we outlined the period in which consultation on the future of the lottery distributors will take place. The results of the consultation will come in by June next year. I am sorry that he has just suggested that he is not prepared to listen to the results of that consultation and that, no matter what anyone says, his mind is made up. That is a pity. The lottery is an excellent initiative, but it is right that, from time to time, we consult the people who buy lottery tickets—that is where the income comes from—to ensure that they still agree with the way that the money is being spent on their behalf. I look forward to that consultation—and I, for one, definitely support the Heritage Lottery Fund.

CHURCH COMMISSIONERS

The hon. Member for Middlesbrough, representing the Church Commissioners, was asked—

Churches/Cathedrals (Accessibility)

Michael Fabricant: What guidelines are given by the commissioners to the councils of churches and cathedrals concerning the   accessibility of such buildings to people other than those wishing to worship.

Stuart Bell: The commissioners recognise that our churches and cathedrals are not just for worshippers; they attract millions of visitors, generating £91 million a year for the   economy and supporting 2,600 jobs. Our cathedrals   and churches bring educational, musical, artistic and community activity, as well as the spiritual. The commissioners are therefore happy to encourage such accessibility.

Michael Fabricant: Would the hon. Gentleman be surprised to hear that, in Lichfield cathedral, for example, there were 83 concerts last year? Some 5,000 people attended those concerts and recitals and a further 10,000 people came to the Close in Lichfield to visit the mediaeval market. [Hon. Members: "Hear, hear!"] Does the hon. Gentleman agree that there needs to be some co-operation between cathedrals so that best practice can be adopted?

Stuart Bell: I am grateful to the hon. Gentleman for his question, and the applause that he received from those around him would indicate that he may have some difficulties at the general election. I presume that that is not necessarily the case.
	As the hon. Gentleman will know, I visited Lichfield cathedral last year, and I listened to a concert and also saw many mediaeval books in the library. It was a significant and impressive experience. Certainly, the cathedrals would wish to work together in best practice, but when we see people coming to our churches and cathedrals for purposes other than worship, we enjoy the idea that they might also participate in the worship—but not in the middle of a Mozart concert.

ELECTORAL COMMISSION COMMITTEE

The hon. Member for Gosport, representing the Speaker's Committee on the Electoral Commission, was asked—

Unitary Authorities (Ballots)

John Mann: Whether the   commission has given advice on ballots for the establishment of unitary authorities.

Peter Viggers: I am informed by the   Electoral Commission that, in last November's referendum in the north-east region, its statutory responsibilities included commenting on the questions in relation to the establishment of unitary authorities and advising on the clarity of the ballot papers. However, the Electoral Commission has not provided general advice on ballots for the establishment of unitary authorities.

John Mann: Some of us did not particularly want regional government, but we would be quite happy to hold ballots on unitary authorities. Is that not exactly the kind of thing that the Electoral Commission should turn its eye to?

Peter Viggers: The Electoral Commission has a limited role as a precursor to the Government's proposals for referendums on elected regional assemblies in the three northern regions. The boundary committee for England was directed by the Deputy Prime Minister to carry out a local government review and to set out options for unitary government structures in the north-east, the north-west, and Yorkshire and the Humber. However, that was the result of a direction from the Deputy Prime Minister, and the Electoral Commission does not give advice on unitary authorities. That is a matter for the Deputy Prime Minister.

Electoral Participation

Bob Spink: What recent representations have been received by the commission on increasing participation in elections among young people.

Peter Viggers: The commission tells me that it receives frequent requests for information, advice and assistance on increasing young people's participation in elections. It has an extensive programme to raise understanding and awareness of the democratic process among young people.

Bob Spink: I am grateful for that response. Is the hon.   Gentleman aware of the excellent work done by the Foyer Federation, which produced the booklet, "Opening doors for young people"? Only 39 per cent. of people under 25 voted in the last election and we must do something spectacular to raise that level. Does he think that a TV campaign targeted at young people might help to increase their participation in the democratic process?

Peter Viggers: Yes, the commission recognises that young people are a key audience for its voter awareness activities and has set up dedicated programmes of activities and campaigns to address that. More can always be done, but hon. Members will agree that the commission must balance the needs of key audiences and the population in general within the budget provided.

Gordon Prentice: The Electoral Commission is keen on text voting, internet voting and so on as a way of driving up participation by young people. Is there not a problem in that those new methods of voting could compromise the integrity of the secret ballot? If we move away from the cardinal principle that people vote in secret, democracy is in peril.

Peter Viggers: Well, indeed. The House knows that a   lot of work went into the creation of the secret ballot,   the whole point of which was summarised by H.S. Chapman, one of the prime movers of the secret ballot, who said:
	"by combining secrecy with limited vote-tracing both protected the elector and detected fraud when election results were in dispute."
	We all recognise that postal voting can do a great deal to drive up participation in elections, but it is important, as the hon. Gentleman said, that we do not lose the golden thread.

CHURCH COMMISSIONERS

The hon. Member for Middlesbrough, representing the Church Commissioners, was asked—

Church Finances

Hugh Bayley: What steps the Church Commissioners are taking to ensure good management of the Church's financial affairs.

Stuart Bell: In the first instance, by appointing the Second Church Estates Commissioner so that he can be answerable to the House. In the second instance and in relation to those Church funds which commissioners manage and which stand at £4 billion, by maintaining a balanced investment portfolio with annual review of asset allocation.

Hugh Bayley: Now that the Charities Bill has passed through this place and is being considered by the other place, can my hon. Friend assure me that the financial affairs of Anglican cathedrals will be better managed in future, to avoid the sort of problems that arose with Bradford cathedral recently when its insolvency left a number of my constituents, who worked for a company called Past Forward, unpaid for work that they had done for the cathedral?

Stuart Bell: I am grateful to my hon. Friend and congratulate him on his interest in Bradford cathedral on behalf of his constituents. He and I had many meetings at that time. As I explained to him then, cathedrals are independent bodies, governed by the Cathedrals Measure 1999, so the commissioners' remit does not run to their supervision or to accepting liability on their behalf.
	On the Charities Bill, let us hope that it enters the statute book before the Dissolution of Parliament, whenever that comes. In the meantime, my hon. Friend will know that the commissioners have had helpful talks with the Home Office on the Charities Bill and are satisfied with it.

Chris Bryant: Does my hon. Friend accept that good management of the Church's finances also means ethical investment so that every investment using dead men's money, which largely subsidises the Church's activities, is made on the basis of sound ethical investment, without investment in companies that are involved in the arms trade or are poor employers in this country?

Stuart Bell: The commissioners' investment policy is of long standing. It is an ethical policy and we do not invest in breweries, cigarettes or arms, as my hon. Friend knows. We are keen on corporate governance and look at companies' corporate governance. We even have corporate governance within the commission. His point is well taken and is in line with our policy. We have an ethical policy on investment and that will continue, although it is, like all our policies, reviewed from time to time.

ELECTORAL COMMISSION COMMITTEE

The hon. Member for Gosport, representing the Speaker's Committee on the Electoral Commission, was asked—

Postal Voting

Bob Russell: Whether the Commission intends to reissue advice to (a) election returning officers and (b) election agents on the level of penalties which will be imposed for breaches of the postal voting system.

Peter Viggers: The commission informs me that, with the political parties, it has developed an advisory code of conduct on postal voting. A draft was published in April 2004 and the commission intends to publish the final version shortly. The code is intended to give guidance to candidates and campaign workers. The commission has also worked with the police on guidance on fraud prevention and has issued a comprehensive guidance manual for returning officers. I   shall ask the commission to place copies of all those publications in the Library of the House.

Bob Russell: I am most grateful for that reply and I   hope that the hon. Gentleman and everybody involved will ensure that the information is drawn to the attention of everybody who is actively involved in elections, whenever they are held, because we have seen instances when the rules have not been complied with.

Peter Viggers: Indeed. It may not be widely recognised that postal voting is now very widespread. I am advised, for instance, that in some areas, such as Newcastle, Cardiff and Stevenage, some 50 per cent. of voters have registered for postal votes. The commission expects that demand—in Great Britain only, not in Northern Ireland—in the forthcoming general election, whenever it may be, will be in the region of 15 per cent. It is obviously extremely important that proper scrutiny and supervision should be exercised.

John Cryer: Havering borough was one of the first pilot areas for an all-postal ballot in the last local elections in London—some time ago. Some of the results in those elections showed deeply unsettling inconsistencies, although nothing further arose. Does the hon. Gentleman agree that we need to send a strong signal that anybody found guilty of perpetrating fraud will be pursued with the full force of the law, because, as he says, there will be a sharp rise in the number of postal votes at the next election?

Peter Viggers: The Electoral Commission has made recommendations for changes to the law on postal voting. However, its current position is that, under the code of conduct, it is committed to self-regulation to begin with, but it will keep the operation of the code under review.

Julian Lewis: Is it not a fact that the reservations expressed by the hon. Members for Pendle (Mr. Prentice) and for Hornchurch (John Cryer) carry great weight? The creation of a system of postal voting on demand, in which the   genuineness of those applying for and receiving the ballot papers cannot be verified, has been a disaster. The   secrecy of the ballot box has been destroyed by the wholesale expansion of a scheme that used to be properly reserved for people who had special reasons for voting by post because they were not able to go to the polling station.

Peter Viggers: The Electoral Commission would probably take the view that the language used by my hon. Friend was rather stronger than is justified by the circumstances. The commission believes that there is a place for postal voting, but it has moved away from the concept that all-postal voting should be the norm in local elections. It now believes that the norm should be   based on what it calls its foundation model. The commission's work on voter choice is nearing completion and will be published in due course.

David Winnick: I have supported the postal voting system, if only because it means greater participation by those who might not otherwise vote. Is the hon. Gentleman aware, however, that greater safeguards are now needed and, if they are not introduced, the whole idea should be reconsidered? The secrecy of the ballot is our main concern and must always be so.

Peter Viggers: The House will have heard the hon. Gentleman's contribution. I repeat that the Electoral Commission takes the view that postal voting has an important part to play in our electoral system but that safeguards are extremely important.

Eric Forth: Surely, though, we must not sacrifice integrity for participation. The views that have just been expressed in the Chamber echo a widespread unease about the slackness of the new postal voting regime. I hope that my hon. Friend will not think that his code of conduct will in any way be sufficient, and that he will go back to the Electoral Commission and stress that the rules must be applied with the greatest vigour in order to ensure that we can be satisfied that postal votes are properly recorded and used.

Peter Viggers: The Electoral Commission will hear the points that are made in the House. The commission has made a series of recommendations to the Government to strengthen the legal framework for postal voting. The   Government have accepted many of those, and   the   commission will continue to keep under review the structure and operation of postal voting in Great Britain.

CHURCH COMMISSIONERS

The hon. Member for Middlesbrough, representing the Church Commissioners, was asked—

Residential Estate

Simon Hughes: What plans the Church Commissioners have to sell parts of the residential estate.

Stuart Bell: The commissioners have entered into discussions with several specialist housing providers with a view to selling the freehold of some of their London residential properties. Tenancy agreements in the event of such sales will not be affected. The commissioners have informed tenants of the discussions taking place, and will communicate with them and other interested parties throughout.

Simon Hughes: Will the hon. Gentleman, first, tell me either now or later by letter which residents in Southwark would be affected by the proposed change of landlord? Secondly, will he ensure that he passes on to his colleagues the fact that it would be entirely unacceptable if a transfer of landlord from the Church Commissioners to somebody else resulted in tenants being in any way financially disadvantaged?

Stuart Bell: I can inform the hon. Gentleman that the discussions that are taking place relate to 480 properties in Stoke Newington, Maida Vale and part of the Waterloo estate, which might be in his constituency. I will be happy to check out the exact figures for his constituency. The commissioners believe that what we are doing will be a good deal for tenants, because unlike the commissioners, the likely new owners are expected to be focused housing providers who are able to invest in the properties for the long term. The commissioners have a wider investment portfolio and a duty to deliver the best possible return in order to help fund the work of the Church.

Point of Order

Martin O'Neill: On a point of order, Mr. Speaker. Is it in order for a Member of this House to enter the constituency of another Member to accompany a Member of the European Parliament on what is called "a mobile surgery"? The hon. Member for   Perth (Annabelle Ewing) is, as we speak, in my constituency to be, as she said to the Alloa Advertiser on 17 March,
	"on hand . . . to deal with issues that are decided in the House of Commons."
	I did not contact the hon. Lady, although she sent me an e-mail at 8 o'clock this morning to tell me that she was going to be in my constituency. As she is a candidate for the new Ochil and South Perthshire constituency, this is not news to me, but what is news to me is that she is assuming that she can participate in surgeries in my constituency. As I understand it, the election has not been called, Parliament has not been dissolved and, although I am standing down, I am still the hon. Member for Ochil, with an office and a programme of surgeries that will stretch at least into the month of April and perhaps beyond.
	I have been in this House for as long as you, Mr.   Speaker, and I have never encountered anything like this during those 25 years or more or in the six general elections in which I have fought. Is this a point of order that I am raising or am I merely drawing your attention to an act of gross discourtesy?

Mr. Speaker: The hon. Gentleman is quite right; we   came into the House on the same day. He has an   excellent record of looking after his constituents. I   would expect hon. Members to come to some arrangement as to how things should be conducted when they go to a constituency, but I do not expect a Member of Parliament to go into another Member's constituency and hold surgeries. That is for the elected representative. As the right hon. Member for Glasgow, Springburn, I would be more than happy if any hon. Member wished to come to Springburn and hold a   surgery, but under the circumstances the hon. Gentleman is right to raise the matter. Courtesies are important in this House and we should not be holding surgeries in someone else's constituency.

BILL PRESENTED

Video Games Bill

Keith Vaz presented a Bill to amend the Video Recordings Act 1984, to extend certain provisions of that Act to video games and to make provision about the labelling of video games: And the same was read the First time; and ordered to be read a Second time on Friday 8 April, and to be printed [Bill 90].

Youth Disorder and Engagement

Oona King: I beg to move,
	That leave be given to bring in a Bill to impose a duty on local   authorities to provide youth services and establish local partnerships to promote youth participation and engagement; and to make other provision in connection with the reduction of youth crime.
	It is of great importance to my constituents and me that I am able to introduce the Youth Disorder and Engagement Bill. In July 2003, I organised a meeting for 150 local constituents to meet the previous Home Secretary and to discuss ways of tackling youth disorder, which is a hugely important issue to me. Local residents were in touch with me every day, as they were   worried about vandalism, arson, graffiti and intimidation by groups of youths. The meeting attracted a wide range of residents both young and old from all ethnic groups.
	Consensus was reached about the two approaches required. First, as Members would expect, people wanted more police on the streets. Since then, I have circulated questionnaires, held local meetings, secured an Adjournment debate, and listened to constituents on the doorstep and in my surgeries. All the consultation convinced me that the initial consensus was correct—everyone wants to be able to walk down the street without fear, and no one wants graffiti, arson and gang fights. The way to achieve that is through a combination of more police and better youth services. We have all heard requests for police, but I hear fewer requests for better youth services. We now have more police. Since 1997, there has been an increase in Tower Hamlets alone of 43 per cent. or 200 new police officers. We have safer neighbourhoods teams, and every area of my borough will have its own team of police officers by July this year. Tower Hamlets will be the first authority in the country to roll that programme out to ensure that residents feel safer.
	The safer neighbourhoods programme is delivering exactly the sort of community policing that my constituents were asking for, and we have already experienced a drop in crime. In the past year, crime in Tower Hamlets fell by 5 per cent., and in one of the first neighbourhoods to have a safer neighbourhoods police team it fell by 15 per cent. That programme is clearly working, but what about youth services? Consultation with residents led directly to this Youth Disorder and Engagement Bill, which is intended to make sure that every borough takes responsibility for providing youth services. It is a scandal that such an important area of service provision is not a statutory duty, and it is now time to crack down on antisocial local authorities that do not take young people's needs seriously.
	Youth services must be good quality, and must work   as a partnership, which means setting strategy locally with all the stakeholders, including the police, the education authority, Connexions, the voluntary sector, parents and young people themselves. Most importantly, youth services must reach the hard-to-reach—kids who have dropped out of education, kids who have been in prison, kids who have recently settled in the UK and, of course, girls. In the past, most youth services have predominantly attracted young men, not young women. Youth services must be both creative and preventive. Kids should have the chance to develop skills and enjoy leisure activities, but intensive work must be undertaken with vulnerable children and those most at risk of offending.
	Not many things in Tower Hamlets are getting worse, but I would be kidding if I said that everything was fine. Two years on from the last time I took 150 residents to meet the Home Secretary, we still have graffiti—my house was done last weekend—vandalism and gangs of youths hanging out on the streets. But let us consider some of the issues that those young people face, and some ideas about how the Bill could help local authorities develop good youth services.
	Tower Hamlets has almost 20,000 young people between the ages of 13 and 19. Fifty per cent. of the community in Tower Hamlets is white, but 60 per cent. of pupils are of Bangladeshi origin and many live in poor quality, overcrowded housing. Our overcrowding rate is four times the national average. Many families are on low incomes. I imagine that in most constituencies there are areas where the majority of pupils are not entitled to free school meals—in Tower Hamlets 60 per cent. of children are entitled to free school meals.
	Tower Hamlets youth services are rising to the challenge, but even Tower Hamlets council has said that although the youth service has performed well, it has not been well regarded. I shall mention aspects of the service that have worked well. One is the rapid response team, which was set up to deal with gang violence, to defuse incidents and to bring a youth work response to antisocial behaviour. The team provides street-based youth work, three mobile youth work vans and early intervention work in schools.
	Let me give an example of one young person, Tony, who had already been involved in gang violence when he met the rapid response team. He was sent to a young offenders institution at 16, after being found guilty of grievous bodily harm, and his probation officer referred him to the RRT. He was given one-to-one support to help avoid a return to his problems and to get appropriate training. He is now on a modern apprenticeship course and works with the rapid response team to help other young people get out of the conflict situations they have been in.
	Another example is Asad, who had dropped out of school and felt that the new start initiative was his first real chance to express himself and develop his own choices. He was supported into volunteering as a youth worker and has finally started a degree in youth and community work at Greenwich university. He said, "Lots of my friends were getting into all sorts of trouble. I thought I was heading the same way, but meeting the new start team and trusting them has given me the chance to leave that life behind."
	We need to ensure kids like that are given the chance to fulfil their potential. This Bill is the first step towards giving every young person the chance to overcome setbacks, disaffection, violence and, in the case of the young people I described, deprivation. The Bill would give them the chance to walk down the street and be welcomed as a force for good, as Tony now is, not feared as part of a youth problem. The Bill is the next step towards bringing back confidence on the streets for all of us.
	In July 2003, 150 people from Bethnal Green and Bow came to Westminster. Tonight another 150 people from my constituency are coming here to meet the new Home Secretary and to discuss the next steps in tackling antisocial behaviour. I am sure my right hon. Friend will listen to what we have to say. I am delighted that my right hon. Friend the Secretary of State for Education and Skills, who is a Tower Hamlets resident herself, is present in the Chamber. I look forward to the time when we ensure that excellent youth services are part of the solution to the problem of youth disorder. I therefore request that leave be given to introduce the Bill.
	Question put and agreed to.
	Bill ordered to be brought in by Ms Oona King, Mr.   Bob Blizzard, Ms Julia Drown, Mrs. Lorna Fitzsimons, Mr. Fabian Hamilton, Kate Hoey, Alan Keen, Tony Lloyd, Mr. Andrew Love, Ann McKechin, Mr. Andrew Miller and Joan Ruddock.

Youth Disorder and Engagement Bill

Ms Oona King accordingly presented a Bill to impose a duty on local authorities to provide youth services and establish local partnerships to promote youth participation and engagement; and to make other provision in connection with the reduction of youth crime: And the same was read the First time; and ordered to be read a Second time on Friday 8 April, and to be printed [Bill 91].

Orders of the Day
	 — 
	WAYS AND MEANS

Order read for resuming adjourned debate on Question [16 March.]

AMENDMENT OF THE LAW

Motion made, and Question proposed,
	(1) That it is expedient to amend the law with respect to the National Debt and the public revenue and to make further provision in connection with finance.
	(2) This Resolution does not extend to the making of any amendment with respect to value added tax so as to provide—
	(a) for zero-rating or exempting a supply, acquisition or importation;
	(b) for refunding an amount of tax;
	(c) for any relief, other than a relief that—
	(i) so far as it is applicable to goods, applies to goods of every description, and
	(ii) so far as it is applicable to services, applies to services of every description.—[Mr. Gordon Brown.]
	Question again proposed.

Budget Resolutions and Economic Situation

Ruth Kelly: Last week, the Chancellor set out the Budget choice facing our country: to continue to build on a platform of sustained economic growth and investment in the future of our country through education, skills, early years provision and child care, or to cut £35 billion from public services. That is not a question of potted plants at the Department of Trade and Industry, as the   hon. Member for Westmorland and Lonsdale (Mr.   Collins) suggested last time we debated the subject in this place—no, it is a sum equivalent to every teacher, doctor and nurse in this country.

Tim Collins: Is the Secretary of State seriously telling the House that she wants people to believe—I dare say that she does, so rather does she believe herself—that any incoming Government would sack every nurse, teacher and doctor? Why does she not treat these debates with a degree of seriousness?

Ruth Kelly: Is the shadow Secretary of State disagreeing with his own shadow Chancellor that a £35 billion cut from public services is "vast", as the shadow Chancellor said on "Breakfast with Frost" last week? Does he agree that £35 billion of cuts is vast, or not? Can he confirm that he would match the £9.4 billion spending programme that the Chancellor announced to rebuild or refurbish every primary school in Britain? Can he confirm that he would make the extra spending on Sure Start, skills or junior apprenticeships, or make the £1.5 billion investment in further education colleges?

Tim Collins: Yes. Now can we have a real debate?

Ruth Kelly: I am delighted about that, because the hon. Member for Havant (Mr. Willetts) said that those are non-priority areas. Indeed, when he was shadow Secretary of State for Education he described Sure Start as the beginnings of the "nanny state".

Derek Conway: Perhaps we could address issues that mean something to the people who may be watching this debate instead of engaging in the usual political knockabout. Will the Secretary of State tell the House exactly what is happening to adult education funding under her Government? The Sidcup campus of Bexley college has certainly been hampered for funds and does not see the fabled growth that we hear about from Labour Ministers.

Ruth Kelly: It has increased; indeed, it has increased significantly, and I shall come to the House tomorrow to talk further about that. We are making unprecedented investment not only in skills, but in further education colleges to update and transform them to deliver the skills that this country needs.

Jim Cunningham: Coming back to the question posed by the hon. Member for Westmorland and Lonsdale (Mr. Collins) about whether the Conservatives would slash everything if they were in government, they would take us back to the old days when we had fewer teachers and doctors and were knocking down schools and hospitals. That is the sort of policy that they want to pursue, and he is not being honest about that. This is not knockabout—it is serious stuff.

Ruth Kelly: I completely agree with my hon. Friend. I   am delighted that the hon. Member for Westmorland and Lonsdale has now committed his party to doubling spending on Sure Start over the next three years and having 3,500 children's centres in this country. That is not what his right hon. Friend the shadow Chancellor has set out in his medium-term fiscal strategy, which says that spending on schools and child care social services will be protected, but that there will be a freeze in the non-schools budget.

John Bercow: The Secretary of State has been advised robustly by my hon. Friend the   Member for Bognor Regis and Littlehampton (Mr.   Gibb) about the desirability of using synthetic phonics in the effective teaching of reading. If she agrees with that proposition, will she confirm to the House that we will not have to put up any more with the ramblings of Kimberley, Meek and Miller, who are three so-called experts in the teaching of reading? They are on record as saying:
	"Within the psychosemiotic framework the shared reading lesson is viewed as an ideological construct where events are played out and children must therefore learn to position themselves in three interlocking contexts."
	The right hon. Lady had the good fortune to have a privately financed education, but millions do not and never will. Is not that sort of nonsense responsible for the destruction of the life chances of a generation of school pupils in state schools in this country?

Ruth Kelly: I am pleased to say that the hon. Gentleman, whom I admire greatly, is right on the subject of synthetic phonics. We have a synthetic phonics strategy in our schools—it is called the national literacy hour. We introduced it in 1998 and its approach is now almost entirely based on synthetic phonics. Indeed, if   hon. Members look at the results of the Clackmannanshire study, to which I believe the hon. Gentleman is referring, they will find that they are remarkable compared with those of control groups in Scotland that do not use synthetic phonics. However, if its results are compared with those under the national literacy strategy taught in England, the gap is not the same. He will agree with me that it is right to teach our children phonics. I want that teaching to be ever improved in our primary school system.
	It is our ambition to be the best-educated, best-trained and best-skilled country in the world. All the evidence shows that if we really want to offer children the best start in life, we must invest in the early years. That is why children and families are at the centre of our strategy. It is right that we do more to support parents and families with young children.
	The children who face the greatest challenges in learning to read and write need to be helped at an early stage. By 2008, we will be investing almost £1.8 billion in Sure Start, thus doubling the funding available now. Over the next five years, early years will become a fundamental part of the welfare state which will be able to respond to the varied needs of children and families. By 2010, we will extend from 500 to 3,500 the number of Sure Start children's centres, so there will be one in every community offering information, health care, family support, child care and other services. We will extend the free early education entitlement for all three and   four-year-olds to 15 hours a week, thus working towards our goal of 20 hours a week.
	We must continue to invest in our schools and to reform them so that we drive standards ever higher, promote good behaviour and widen opportunity. All parents have the right to have their children educated in modern facilities and orderly classrooms with strong discipline and good standards of teaching. We now have   more teachers than before, with more than 28,000 recruited since 1997. There are now 105,000 more support staff in our schools.
	The standards of teaching are better than ever before. Our children are gaining the best results ever at age 11,   GCSE and A-level. Those results compare with the best in the world, but we must go further. Some 78 per cent. of 11-year-olds achieve level 4 in English and 74 per cent. gain level 4 in maths, but we know that the chance of children achieving five good GCSEs is almost seven times higher if they reach those expected standards. We must support teachers in driving standards ever higher. To do that, we need to focus on the needs of every child and have first-rate places in which children can learn. Last week, the Chancellor announced the 15-year programme to rebuild or refurbish all our secondary schools to world-class standards. He said that that strategy would be extended to all our primary schools.
	For those children who have not reached the expected standard in literacy and numeracy by the end of their primary school education, we will continue to place a relentless focus on the basics at secondary school, thus ensuring that every child who leaves school is equipped with functional English and maths for work and for life.

Phil Willis: Will the Secretary of State clarify her statement about rebuilding all secondary schools? We support that policy, so it is not a trick question. The Labour party's website says that all secondary schools will be rebuilt by 2016, whereas the Department's website states that three in every local education authority will be rebuilt by 2015. Which is correct?

Ruth Kelly: We have a 15-year strategy to rebuild or refurbish all our secondary schools. The first will be rebuilt in 2007 and the strategy will go on from there. We have a programme for primary schools on the same timetable. However, not all local authorities will have to wait for their place in the 15-year programme. In the interim period, we can offer the chance to all local authorities to have their most run-down schools rebuilt or refurbished. I am not aware of the details on the Labour party website, but I suggest that they relate to local authorities not having to wait in the queue for all their secondary schools to be rebuilt or refurbished.
	The key to ensuring that every child who leaves school is equipped with functional English and maths for work and for life is to free the curriculum for 11 to 14-year-olds to provide space for tailored support—help with the basics, and challenge and stimulation for children who would benefit from it.
	Behaviour is good or outstanding in most schools. We are clear that there must be strong measures when dangerous and violent conduct occurs. However, all parents and teachers know that we face the challenge of low-level, disruptive behaviour in our classrooms. The answer is not to create new sink schools, full of excluded children, but to redraw the line on what is an acceptable standard of behaviour in the classroom, nipping bad behaviour in the bud. We must have a zero tolerance approach to bad behaviour, providing schools with the resources that they need for on-site or off-site facilities to withdraw children from the classroom when and if they need to do that.

Kelvin Hopkins: Is my right hon. Friend interested in the recent research that shows that food and drink additives have an enormous effect on children's behaviour? In a school in America, where children have been removed, they take away all the drinks that contain additives and the children calm down and become normal. I hope that my right hon. Friend accepts that serious point.

Ruth Kelly: My hon. Friend always makes serious points and he is right to raise that one. We know that healthy meals promote good standards of behaviour and that children achieve more when they are fed healthy food. That is why we have recently been talking about the new school foods trust that we are setting up and how we can make change happen in our schools so that all children have the chance to eat a healthy meal. I shall present more details of our proposal in the next few weeks.
	I want every secondary school to be part of a network of schools by September 2007. We must focus our efforts on those schools that are found by Ofsted to have unsatisfactory behaviour. That is why I recently announced that local authorities would draw up urgent action plans to support the schools identified by Ofsted as being in that category, backed up by return visits from Ofsted within a year to check on progress and ensure that improvement is under way.
	Through increased and sustained investment in information and communications technology, we also ensure that learning is tailored closely to each young person's needs and circumstances, including the facility to learn from home when necessary. Strong, autonomous schools, closely linked to home and each other, with a strong sense of mission and purpose, will transform opportunities for our children. If all young people are to make the most of their skills and talents, it is crucial to give them the opportunity and encouragement to stay in learning until they are at least 18. Far too many young people drop out of school at 16 or 17. Our participation rate at the age of 17 is one of the worst in the industrialised world.
	The White Paper on 14 to 19-year-olds, which was published last month, outlines our proposals to build on the current system of GCSEs and A-levels to enable all our young people to combine practical, work-based learning with traditional, academic learning in the classroom. In future, children will learn the subjects that they enjoy at their own pace in places that motivate them.

Ian Gibson: I was sorry that my right hon. Friend passed over the subject of Sure Start so quickly. I visited a Sure Start centre in Norwich this weekend, and I was amazed at the design of the furniture there—I was interested to find out that it had been made by the Amish—at the state of the kitchens and at the food that was being given to people. The encouragement that was being given was very good. My right hon. Friend is talking about 14 to 19-year-olds, but we now have a generation that is being encouraged to think and act differently. Does she agree that that is a credit to all the policies that we are operating across the whole educational field?

Ruth Kelly: I completely agree with my hon. Friend. What is more, all the evidence shows that if we get the early years right, and if children start school ready to learn at the age of five, it has an impact on their performance right through primary school. The Sure Start system works best when parents feel that they have control and ownership of the courses in the Sure Start programme which they can attend while their children are learning and playing. In some Sure Start programmes, we have seen really innovative learning programmes, involving dads and books, for example, and mums learning to cook—to come back to the point made by my hon. Friend the Member for Luton, North (Mr. Hopkins). The scheme presents a huge opportunity to make a lasting difference not only to children but to their parents.
	We recognise that, when a child reaches the age of 14,   there are sometimes financial barriers to their participating in education, particularly for those from lower-income households. That is why we are rolling out education maintenance allowances nationally. They will play a significant role in widening access to further and higher education by encouraging more young people from lower-income backgrounds to enter academic or vocational post-compulsory education. More than 290,000 young people have enrolled for education maintenance allowances under the national scheme so far.

Kelvin Hopkins: My right hon. Friend may know that some of the early pilots for the EMAs were carried out at the Luton sixth-form college. They provided a double bonus, because the families were helped and the students turned up for their classes and learned better as a result of having the reward of the EMA.

Ruth Kelly: I am delighted that my hon. Friend has mentioned the pilot schemes in his constituency. The EMA pilots were also carried out in my constituency, so I have first-hand experience of their fairly dramatic impact on raising participation and attainment, partly because of the incentive to complete courses involved in the EMA programme. We have a real opportunity to encourage participation and to tackle the financial barriers that exist.

Patrick McLoughlin: The Secretary of State says that EMAs offer a tremendous advantage to people staying on at school. If that is the case, why does she not believe that tuition fees have a deterrent effect on people considering going to university?

Ruth Kelly: The hon. Gentleman will know that we are reintroducing grants for the poorest students, abolishing up-front fees and ensuring that students will not have to pay a penny while they are learning. I hope that he took note of the study recently produced by the Institute for Fiscal Studies, which said that students will be £1.5 billion better off under the Government's programme than they would be under the one proposed by the Opposition.
	As a result of the Budget, we will be able to offer an extra 20,000 opportunities in pilot areas from 2006–07 for disaffected 14 to 16-year-olds, either at work, in college or with the voluntary sector. In 1997, as we emerged from the Conservative years, there were just 75,000 apprenticeships. By 2008, 300,000 young people will be in apprenticeship training. We also want to ensure that the 150,000 16 and 17-year-olds in the United Kingdom who are in employment with no training improve their skills, so we will pilot new approaches to encourage those people to take up apprenticeships or other structured training. We will also pilot learning or activity agreements for those young people not currently in education, work or training. This is clear evidence of our determination that every young person should fulfil their potential through education and training. As a result, I want our participation rate at the age of 17 to rise from 75 to 90 per cent.—one of the best in the industrialised world. Every teenager must have the opportunity of a guaranteed place in sixth form, on an apprenticeship or in training.
	Tomorrow, with your permission, Mr. Speaker, I will publish the details of our second skills White Paper. Together with the proposals in the 14 to 19 White Paper, it will set out our ambition to create a skilled and competitive nation in which all adults have access to basic skills training and the opportunity to progress. It will describe the new national employer training programme, which will build on the success of employer training pilots. It will offer employers easy access to the skills solutions they need, including free training for their employees without a first full level 2 qualification. We expect the new programme to reach full capacity by 2008, when it will cover 350,000 learners and 50,000 employers.
	To achieve our ambitious plans for 14 to 19-year-olds in skills, we need a step change in capital investment in our further education colleges. I want to see a network of strong and vibrant colleges delivering training to industry standards in modern buildings with leading-edge equipment—colleges that can respond quickly and flexibly to the needs of employers and young people; colleges that make a major contribution to the productivity of the country.
	This Government will invest £1.5 billion over the next five years to support the long-term transformation of the sector. That is the Budget choice facing the nation: continued investment and reform for the future—in early years, child care, the renewal of primary and secondary schools to world-class standards, investment and skills, and training—or a £35 billion cut in   spending, which cannot but eat into education and skills.
	That is the choice facing the country. I commend this Budget to the House.

Patrick McLoughlin: On a point of order, Mr. Speaker. I   think I heard the Secretary of State say that the Government are to publish a White Paper tomorrow. Bearing it in mind that they have designated today as the day to debate education, would it not have been more appropriate and courteous to the House to have published it today?

Mr. Speaker: That is not a matter for me.

Tim Collins: I think that Members on both sides of the House would probably agree that the Secretary of State's speech was disappointingly thin, but let us begin on what I hope is a note of consensus: all Members of the House agree that schools, teachers and pupils are working very hard, and often very successfully. They are to be praised for what they do and congratulated on what they succeed in doing, despite the difficulties and challenges that they face.
	The Chancellor boasted in his Budget speech of all the extra money he has put into education. To be clear, the   Conservative party does not doubt that he has put a lot of extra money in. We do not assert that it has all been wasted and we do not propose, contrary to the wholly unfounded assertions of Ministers, to do anything other than increase spending on education in general and schools in particular very strongly in coming years.
	I hope that we hear no more of the juvenile nonsense that we heard today about the absurd fiction that Conservatives plan to sack every nurse, doctor and teacher in the country. Frankly, it demeans public debate when such charges are thrown around. For the record, and for the Secretary of State's benefit, we do not intend to slaughter the firstborn either.
	There are, however, genuine problems with this Administration's education record. For example, the Select Committee on Education and Skills has pointed out that it is often difficult to see that the Government's education proposals have been properly thought out or that they are delivering appropriate value for money. It has warned that the Government should not continue to overclaim the effect of some of their increases in expenditure.
	The Select Committee has also pointed out recently that the Government's city academies, although they are based on city technology colleges and therefore are not something with which we differ in principle, have yet—shall we put it mildly?—to prove their full successful potential.
	This very morning, a programme for international student assessment, or PISA, study indicated that investment in high technology and computers, welcome though it is, is by no means guaranteed to produce higher outputs in terms of better exam results or a better   grasp of literacy and numeracy. The Statistics Commission has again warned the Government that they should not overclaim the progress on literacy and numeracy. I am delighted that this week, unlike last, the   Secretary of State seemed to heed that warning. The National Audit Office, no less, has pointed out that the   Government have spent £885 million on anti-truancy initiatives without making any progress. Indeed, on the Government's figures, truancy is now one third worse than it was in 1997.
	Furthermore, calls have been issued by employer organisations, universities and others indicating increasing concern about the extent to which exams are not as robust as they ought to be. Clearly, when an A grade can be awarded in GCSE maths for 45 per cent. of the marks, or a pass mark awarded in one GCSE exam for 18 per cent., something is fundamentally wrong. This party has a strategy to reverse those problems, starting with a root and branch clear-out at the Qualifications and Curriculum Authority. The Secretary of State appears to have no answer at all beyond a vague promise to examine A-level standards again in 2008. That is simply not good enough.
	The Chancellor, in his Budget statement, used some interesting language:
	"Head teachers of a typical primary school will receive £31,000 this year, rising to £34,000 and then £36,000, a guarantee over the next three years . . . of a total of more than £100,000. Head teachers of the typical secondary school will receive £98,500 this coming year, rising to £109,000, rising then to £115,000—a guarantee over the next three years of a total of almost one third of a million pounds."—[Official Report, 16 March 2005; Vol. 432, c. 269.]
	He used the word "guarantee" twice. What does the Red Book say about those figures? On page 149, in a footnote, it states:
	"These figures are an approximation . . . however, the Government intends to revise this formula which will mean that increases in allocations to schools will be distributed differently . . . These figures should therefore be taken as a broad indication only."
	So much for a guarantee. Head teachers up and down the land feel that they have been here before, because the last time the Chancellor gave us such a Budget was in 2002, which was followed by some of the most acute financial crises for many of our schools for 10 to 15 years or more.
	We welcome the principle of additional sums being paid direct to head teachers, but we wonder why all sums are not paid direct to them, as they would be under the Conservative party's proposal to make all schools grant-maintained and to take local education authorities out of the funding process entirely.

Peter Luff: On the subject of guarantees and promises, will my hon. Friend confirm my understanding that our party is committed to the education spending plans of the Labour party? Therefore, were a Minister to come to Worcestershire to   promise the delivery of a new school—say, the Christopher Whitehead school in Worcester—that could equally be guaranteed under our party's proposals. What is more, our proposals would also guarantee a narrowing of the funding gap between Worcestershire schools and the shire counties schools, which has grown monstrously in recent years.

Tim Collins: The answer is yes. Indeed, I, too, visited the Christopher Whitehead school a little while ago, and unlike the Minister for School Standards, I did not claim that only by voting for my party was there any prospect of that school getting additional funding. Since he was quoted in the local newspaper as saying that that school would get extra funding—which it has needed for at least the past eight years of Labour Government—only if Labour was re-elected, I am happy to confirm that it would of course get that money under a Conservative Government, along with a great deal more financial freedom.

Adrian Bailey: When I was chair of a finance committee in the metropolitan borough of Sandwell in the early 1990s, we had to make something like £8 million of cuts in Sandwell's education budget. Let us compare that with the growth in the education budgets for Sandwell under the Labour Government, which the Opposition have made a welcome commitment to sustain. Does the hon. Gentleman agree that the essential difference that explains why such commitments can be made is that this Government have turned round the economy with a huge increase in public resources which can be invested in our public services? That was lacking under the Conservative Government.

Tim Collins: I am grateful to the hon. Gentleman for pointing out that any increases in public spending in the future, under this or any other Government, will depend on the state of the economy. I must tell him, however, that the turnaround in the economy occurred considerably before 1997, and that the longest period of economic growth since records began—to which the Chancellor seems always to refer—started considerably before 1997.
	All of us—Members in all parts of the House—accept that one decision by the Government for which they do deserve a great deal of credit, in the context of the present state of the economy, is the decision to make the   Bank of England independent. I am sure that the hon. Gentleman will join in the joy and delight being expressed throughout the House that one party is still committed to an independent Bank of England—the Conservative party. All the others want to put it under the control of the European Central Bank.

Adrian Bailey: Will the hon. Gentleman give way?

Tim Collins: No, I will not give way to the hon. Gentleman again.
	If head teachers are to be trusted more and more with running their own budgets, even under the Chancellor's schemes, why are they not trusted to exercise the same professional freedom in deciding their own policies on admissions and exclusions?
	The Secretary of State referred to the national literacy strategy. She used some very interesting terminology—terminology that I think she will find herself under considerable pressure to justify in the coming weeks and months. Of course she will not be responsible for these matters in the coming months; but she will be under pressure to justify it in the coming weeks, at least. She said—I think I quote her correctly—that she believed that the national literacy strategy was "almost entirely" composed of synthetic phonics. I must tell her that that is not the view taken by a good many distinguished experts, who point out that if synthetic phonics are to work, they must be used not alongside other approaches but first, fast and exclusively. How can any education system be seen as remotely satisfactory when—even according to the Government's figures, and even after the Government have dropped the pass mark—one child in four fails to reach the required standards in literacy and numeracy?
	The Secretary of State also referred to the group of young people who are not in education, employment or training. No doubt we will debate that again tomorrow. She failed to mention that the number of such people has increased, not decreased, since 1997.
	We thought that, in the light of weekend press reports, the Secretary of State might have something to say about the Government's response to Jamie Oliver's campaign for better school meals. We learned from The   Observer yesterday that the Prime Minister has apparently identified that as a high priority, and has   committed additional resources to it. The first thing that should be said is that no party that has been responsible for any part of education spending at national or local level in the past 20 years should be anything other than ashamed by what Jamie Oliver has discovered and publicised. It is clear that both resources and strategy have been badly wrong for many years, and they are still badly wrong today. Will the Secretary of State confirm, however, that the issue was barely mentioned in the five-year plan for education, sidelined in the three-year spending plans, ignored in the public service agreements, and not mentioned in the Budget?
	It would have been helpful if the Secretary of State had been able to clarify—given that both she and the Prime Minister were quoted at great length in yesterday's and today's newspapers—whether they have identified a single penny of new money for initiatives in that regard, and where any such money would come from. When the Conservative party announces its response, very shortly, it will not take a great deal for that response to be considerably more substantive than what we have heard from the Government to date.
	The Secretary of State rightly mentioned child care. My right hon. Friend the Member for Maidenhead (Mrs. May), the shadow Secretary of State for the family, will set out our detailed proposals soon, but I   shall say a few words now. The Government have a mixed record—not a record of unmitigated failure, but not one of unmitigated success either. There has been a genuine and substantial increase in the number of state-funded places available in nursery education and child care places for very young children.
	For that reason, I am happy to confirm again that we will preserve and improve Sure Start, and will not abolish or cut it. However, since 1997 there has been a sharp decline in the number of places provided by individuals and groups that are not funded by or subject to the direction of the state. There has been something of a failure to recognise or understand that parental needs and preferences are not uniform or identical. There has been little to no research into or focus on the quality, rather than the quantity, of child care provided. In particular, there has been little analysis of why children aged 11 and above in Scandinavian countries seem to perform appreciably better than ours, even though they do not start formal education until the age of seven or later. In short, when the Chancellor announced in his Budget statement that he simply wants more years of education, rather than a focus on quality, many will have sighed with irritation rather than pleasure.
	Our priority is not to spend less on education; it is to continue to increase spending strongly, but to spend the money more wisely. We will reduce the number of administrators in the Department for Education and Skills by two thirds, transferring all the money direct to the front line in schools. We will do away with the absurdity of the Government's top-up fees scheme, which will cost the taxpayer £1.1 billion a year, in order to give universities an extra £900 million a year.

Kelvin Hopkins: I am interested in the hon. Gentleman's suggestion that the Conservatives would devolve more spending to the front line. Gershon's report suggests that in fact, pooling resources and scaling up—particularly to local authorities or even to Government for matters such as ordering—would be a more efficient way of spending money. One could save money by greater centralisation, rather than by more devolution.

Tim Collins: Gershon came up with a number of very interesting recommendations in his report, but if his bottom line is that—to summarise the hon. Gentleman's intervention—centralisation is a way of saving money, I   should point out that that flies in the face of the experience of all Governments in at least the past 50 years. The fact is that the more decisions are taken in   Whitehall, the less value for money one gets. That is   why we are determined—on the basis of independent advice received from the extremely respected James committee—to proceed in entirely the opposite direction, and according to the view that value for money will proceed from devolving power and decision making, rather than from taking it upwards.
	I was going through a list of some of the ways in which we will spend money differently from this Government. We will scrap the top-heavy, expensive and unpopular learning and skills councils, transferring money away from their huge administrative costs and into the proper provision of vocational education and training instead. We will abolish the failed Connexions programme and use the savings to fund the re-creation of a proper careers service.

Phil Willis: I have heard the argument for getting rid   of the Learning and Skills Council, which is in the James review's report. How would a college get its money under the Conservative proposal? Would a Conservative Government directly fund each student, or would a new quango be created to distribute funds to the colleges?

Tim Collins: I am grateful to the hon. Gentleman for his question. We propose to merge the Higher Education Funding Council and the Further Education Funding Council, reducing the number of quangos by one. We do indeed intend to apply to further education the principle of money following the student, as we already propose to do in secondary education, and as is the logical consequence of the changes taking place in higher education. We furthermore intend to offer both FE and HE a much simplified funding structure that involves no top-slicing and getting rid of all the silos. The hon. Gentleman will be familiar with the frustration that many FE colleges and HE institutions feel when the various bureaucracies that interfere with their work tell them how to do their job. We propose something much simpler and much more cost-effective.
	In our first term, we will invest in providing 600,000 additional school places as part of our commitment to giving 100,000 extra parents their first choice of school. We will invest in building new "turnaround schools" to sort out the problem of disruptive children in mainstream schools who cannot be educated, and who do not allow others to be educated. That is in clear contrast with the Secretary of State. She said that she is in favour of drawing lines in the sand, of zero tolerance and of cracking down hard on misbehaviour, but it transpires that that means that head teachers still would not have the final say on exclusions, and that she believes that she knows better than they do whether a child should be excluded. Moreover, we will invest in keeping special schools open, rather than allowing more and more of them to close in pursuit of a politically correct and often entirely inappropriate strategy of one-size-fits-all inclusion.

Ruth Kelly: I am very much looking forward to the moment in the hon. Gentleman's speech when he discusses his proposal to take money out of the state system, through a voucher policy, and to put it into the independent sector. He disagreed with my figure of £1 billion last week; will he now confirm how much his proposal will actually cost?

Tim Collins: What we established last week was that the Secretary of State had produced a figure that she alleged was the cost of the Conservative policy, but she could not provide a single Conservative quotation to justify it. We also established last week that the policy that she criticises us for advancing in respect of education is exactly the same policy that her Government are currently implementing in respect of health. In other words, a patient is usually paid for by the taxpayer, and a child is usually paid for by the taxpayer when access to a state hospital or school is required. People who want to access a school that is not owned or run by the state are, in the Secretary of State's view, taking money out of public services in education, but if they want to use a hospital that is not owned or run by the state, they are acting in accordance with the spirit of proper reform in health care. In our view, that is   a sensible policy to pursue across the whole of the public services. How, then, does the Secretary of State distinguish what we are proposing for education from what her Government are now doing in health?

Ruth Kelly: It is interesting to note that the hon. Gentleman is giving an entire speech on education without mentioning his party's policy of introducing vouchers, under which money can be taken out of the state system and put into the private sector. He asks me where I came across the £1 billion figure, and I can tell him. I got it from Lord Blackwell, head of the No.   10 policy unit between 1995 and 1997. [Interruption.] The hon. Gentleman knows that, and if he is going to disagree with the Conservative head of that unit, perhaps he will tell us how much money his voucher proposal will take out of the state education system.

Tim Collins: The Secretary of State should apply one of the rules advanced by a former Labour Front Bencher in the House of Lords. It became known as Healey's first law of holes: when in one, stop digging. If the best that she can come up with is a reference to someone who has not been associated with the Conservative Government for nearly a decade—

Stephen Twigg: There has not been a Conservative Government for nearly a decade.

Tim Collins: Well, he has not been associated with the Conservative Front Bench for nearly a decade either. The Secretary of State will have to do rather better than that. If she wants to get into the business of quoting independent think-tanks, I was interested to hear that earlier in her speech she quoted the Institute for Fiscal Studies. I would have thought that that was somewhat unwise for any Minister in a Budget debate. It is perfectly in order for me to point out, Mr. Speaker, that the Institute for Fiscal Studies believes, and has said on the record, that the Chancellor will have to increase taxes very substantially after the next election, by something in the order of £11 billion. That has been said again and again, and we are happy to go into the general election on the basis of a battle of the think-tanks, if that is what the Secretary of State wants.
	The choice at the next election will not be about how much money should be spent on our schools—both parties wish to spend broadly the same—but about how it is spent. Labour says more and more of it should be spent on bureaucrats, form fillers and top-heavy quangos. We say that more and more of it should be spent in schools by head teachers on their own priorities and, yes, money should follow parental preference. Labour says that quantity is all that matters—more exams, more years of education, more places at university. We say that quality, merit and proven effectiveness are what really matter in child care, exam credibility and access to university. No one is benefiting if more and more graduates leave with higher and higher debts in pursuit of fewer and fewer well-paid graduate-level jobs.
	In this Budget, as ever, the Chancellor has been boastful. We say that the fundamentals of education are no more secure under this Administration than are those of pensions, taxation and competitiveness. With truancy up, violence up, a teacher assaulted every seven minutes, confidence in exams falling, literacy and numeracy standards unacceptably poor, and the quality of school meals a national disgrace, we do not want more of the same. It is time for a change, so let us have that general election right now.

Ian Gibson: I was sorely tempted to discuss the initiatives of the Design Council and its chair, George Cox, particularly examining the products of small businesses. However, I changed my mind and decided to talk about how small businesses came about in the first place. Here in the Chancellor's document is a seven-page initiative about science, innovation, technology and engineering. We do not usually hear those subjects discussed in such a full-hearted way, so I am extremely encouraged by the   contributions of Labour and, in particular, the Chancellor to developing ideas in this sphere.
	There has been a slow realisation of the importance of such subjects, which has led to the doubling of the science budget under the Labour Government. A long time ago, I promoted a ten-minute Bill asking for that and never believed that it would happen, but it has—I   should have asked for the budget to be quadrupled. The Government have given great encouragement. I am pleased about that and congratulate them.
	The importance of science and technology in developing the economy and business and in employing people and so on is seriously to be welcomed.

Jim Cunningham: Like my hon. Friend, I   welcome the Chancellor's increases for science and technology. I am sure he agrees that that is important for research and development in universities and industry, and for so many aspects of our economy.

Ian Gibson: I agree and I shall deal with that point in more detail to show how we can plug some of the gaps in those developments.
	I want particularly to talk about the £2.5 billion that is being put into biotechnology. One aspect of biotechnology was highlighted in the Budget speech—stem cell research. Many Labour Members, including my right hon. Friend the Secretary of State, will remember that we argued about that subject profusely, but we came up with legislation that has stood the test of time and has put Britain at the forefront of research in that field. Christopher Reeve was extremely confident about this country. Just before he died, he expressed support for our arguments and congratulated us on being well ahead of America. We do not often hear that in the fields of science, technology and engineering these days.
	There are many benefits just around the corner. The organisation that the Chancellor is setting up, to be headed by Sir John Pattison, includes the Stem Cell Foundation. In terms of stardom, the list of its members reads more like a Chelsea football team than a Norwich football team. I exempt myself from those remarks as I   confess that I, too, am a member of that body. Everybody else is a knight or a dame, including Sir   Richard Branson, Sir Christopher Evans and Dame   Mary Archer. It is a glittering group. I shall probably be asked to take the minutes, which I shall   gladly do.
	Some of the work going on in this country is within a year of reaching clinical trial. In London, in Newcastle, at Roslin in Edinburgh—Dolly the sheep emanated from work there—and in Durham, people are carrying out research on brain infarctions and using stem cells to sort out some of the problems. In the long term, there will be work on Parkinson's and Alzheimer's. Diabetes is being investigated and that work is very close to clinical trial. Corneal and bone repair research is going on, as well as work on graft structures for heart valves and blood vessels. Within a year all that work will have reached phase 1 or phase 2 of clinical trials with patients. We can bet our bottom dollar that there will be some successes in that field and the UK is ahead of the game.
	As well as the stem cell foundation, the Medical Research Council will be receiving more money. The Wellcome Trust will be putting more money into such research and the Department of Trade and Industry will also be involved. All that forms a nucleus that will keep this country ahead in one aspect of biotechnology, although of course other work is going on in the private sector.
	Much money has gone into economic research and knowledge transfer—for example, the Richard Lambert business initiative to enable businesses and universities to work together better. The fault does not always lie with the universities; sometimes businesses do not relate to the people who are developing that bright new technology. I am not referring merely to stem cell research.

Phil Willis: Does the hon. Gentleman agree that a big problem faced by many of our universities that lead bioscience technology research is that they cannot get technicians to support the scientists? There is a mismatch between what schools are doing, especially at level 3, and what the universities actually need in terms of technical support. Does the hon. Gentleman have a solution for that problem?

Ian Gibson: I thank the hon. Gentleman for that intervention. Yes, I will address the training of our young people in universities in the latter part of my speech, but we must consider more than just the universities: university students and graduates come from schools, so the science, engineering and technology taught in schools, as well as the technicians themselves, are extremely important. We are missing a trick or two in that respect, and I shall make some suggestions about that.
	We are putting much more money into clinical research, and not just in relation to stem cells. We are putting money into engineering under the Budget. We are bringing researchers over from other countries. Indeed, Roger Pedersen—a friend of mine who is a professor in stem cell research on the Addenbrooke's site at Cambridge—has come from California and will not go back because we are ahead of the game. In the next week, there will be another sensational recruit and transfer from across the great pond into this country. So we are well up front.
	The Chancellor announced that we will put money into sustainable energy and other energy developments in relation to climate change and global warming. He also announced science cities. Now there is a concept. I   asked various eminent people about the term "science cities", and the only answer that I got was, "Well, that'll be another sign outside a place. Does it mean anything?" If we read the script properly—we have more to do on it—the relationship between the science and business communities will be extended and will grow because of the feeling of being a science city. They exist across the world. For example, Sir Richard Sykes of Imperial college tells me that Novosibirsk—I have been there—in Siberia is an amazing science city, where it is minus 20°   centigrade outside, so the scientists and teachers do not get out very much, as hon. Members can imagine. Perhaps that is not a bad idea, so let us have a bit of global cooling as well.
	Bristol, Birmingham and Nottingham are all areas where we will have science cities, and they are being developed under the aegis of the regional development agencies. Not all the regional development agencies are   up to speed at encouraging interaction between universities and businesses to develop a part of their region into a science city. The other night, the Home Secretary and I entertained many glamorous people in Norwich in a business tent to collect huge sums of money for the Labour party—who in their right mind would vote for anyone else these days?—and we asked them what they would do about making Norwich a science city. There was a long silence, and we said that, as soon as we get back and get on with business, Norwich would become a science city and we would knock some heads together. The concept is intended to drive people together in order to promote the whole science arena, in the areas that the Government have identified, to the level of world excellence.

Peter Bottomley: Just in case someone reads this speech after today, can the hon. Gentleman name a serious scientist who either believes that the present number of Labour MPs is good for the Labour party, democracy or science, or wants to see the   present Government returned to power?

Ian Gibson: I can assure the hon. Gentleman that that   was in the first motion passed at the Stem Cell Foundation, and the House would miss several eminent   Labour Members' contributions to science and technology and, indeed, to higher education— top-up fees and so on—if we were not returned to government. Many constituents will believe that, and many members of the Royal Society believe the same thing, too, but there may be one or two people in other places that I have missed.

Peter Bottomley: Just for clarity, will the hon. Gentleman, who is well recognised in scientific circles, say whether he is suggesting that the Royal Society or the Stem Cell Foundation had a vote on whether they preferred to see the Labour Government return for another term of office?

Ian Gibson: I have not seen the minutes, but I seem to recollect that there was such a vote following a discussion of the issue at the first meeting. There was no opposition, and Lord May and Lord Winston, as one may expect, go along with me. Those people are forming in that foundation a paradigm for many other areas as well, but we shall return to that, no doubt.
	There are one or two storm clouds. I do not pretend that everything is wonderful. There are many more things to do, and the Budget has opened the way for that. There are certainly questions about research and development, as the hon. Member for Worthing, West (Peter Bottomley) will remember in relation to health care. We lag behind in terms of initiatives and developments in comparison with India and China, but we should not hold up our hands and wallow in defeat; we should say that we can do as well, if not better, and that is the spirit that the Budget has delivered to many scientists in this country. For the first time, we have doubled that budget and people are smiling and beginning to work, but there is more to do in that arena.
	The problem is not just competition, but trying to persuade small businesses to develop that sort of work and to increase research and development in science-intensive small businesses. A private Member's Bill that   my hon. Friend the Member for Cambridge (Mrs.   Campbell) intends to present has been picked up in the Budget, which requires Departments to provide money for research. It will be mandatory for 2.5 per cent. of the research and development budget to come from Departments.
	There are problems accessing venture capital. Venture capitalists are strange people—I met some in Cambridge on Friday night—and talk in billions not millions of pounds. They work in the short term and want results within one or two years, but results take longer than that in many enterprising and innovative research arenas. We must marry those two different views and, at last, we are starting to talk to venture capitalists. The aim is to encourage small businesses—not just bright people from universities but inventors and the James Watts's of this country because they have bright ideas and need support.
	Another problem is VAT, as hon. Members know, for organisations involved in biomedical research and so on. I have taken two cases to the Inland Revenue to ask its officials to remove VAT because of the nature of the research. A charity in my constituency is trying to develop a cancer information centre, but has been told that because it is connected with a private finance initiative hospital it must pay the full rate of VAT. The money comes from charity and there is a lot of reaction against that decision. The Minister will recognise that problem, which arises time and again. I never want to meet another official in my life, although when one puts the arguments one sometimes wins £1 million for a   university or £2 million for a charity. I hope that something will be done about the VAT problem. The process is clumsy and we must do something about it.
	There is something fundamentally at odds with the problem of developing small industries. The antipathy of many young people to taking their research and discoveries to the marketplace must be seen to be believed. The culture in this country is that people dirty their hands if they go into business after doing magic work on this, that or the other, whether chemistry, physics or mathematics, and so on. The sort of people that I have talked about—Paul Grayson, Chris Evans and Richard Branson—have had such experience but they are true entrepreneurs in a sense that is sometimes hard to define. Many people think of themselves as entrepreneurs, but are not because someone else takes on the marketing and development problems, proof of concept stages and so on. Making a discovery does not suddenly result in a glorious product that the world awaits. It must be marketed and it is difficult to tell someone to leave it to another professional or expert in the area to develop the product. Partnership and teamwork are necessary and we are beginning to accept that.
	I once thought I had the answer to prostate cancer. I   discovered a gene and went to my bosses at the university to ask them for advice on how to start a company. The answer—I kid you not—was, "You need headed notepaper." That was depressing. To get a kick-start and an introduction to someone who has been through the process is a big step. One gets depressed, but then one gets on with winning the research assessment exercise and glorious kudos as a scientist, but one forgets the other aspects of the work. We need to do much more to encourage that side of matters.
	If there is one factor that distinguishes the US from this country it is that people in the US take risks. In the US, people can fail once, twice and even three times, but they are still not failures. It is recognised that it may take four attempts to achieve something, but every time something does not quite make it, lessons can be learned. That is how Americans are encouraged to think, but that does not happen in this country. People are deflated and put down if something does not work. The knives go in and people are put off. We have to change that culture, and we should start in schools by encouraging people to experiment and think. If they do not succeed the first time, they should be patted on the back and told to try, try and try again. We have a long   way to go in introducing that attitude into our teaching culture.
	The Government have also talked about other aids for small businesses, including tax credits, involving the Inland Revenue, ways to give people the confidence to get on and do it, and setting up Lambert-type interactions. However, we still have a serious problem with physics and chemistry departments in universities closing. That is not a new phenomenon, but when universities lose key departments, it is demoralising for those who work in them and it creates a threatening environment for everybody else. I am pleased that the Government have started to consider how we can prevent such closures.
	We know that we need bright young people, not only for policy-making but for research, development and   innovation. However, the number of people taking the subjects I have mentioned has been declining for   several years, and that contributes to the closure of departments. If they are closed, we will not be able to take on the extra students coming through the system who want to be chemists or physicists, or to develop new subject matter. We have intervened to try to increase the number of university places, but we have to be smarter. We have to look at the root cause of the decline in   student numbers that has led to the closure of departments. We need to inspire students and young people in schools to study science. We want teachers who can be creative and enthusiastic. We need to change the curriculum, because it is dull and boring. When I   visited a school in Norwich, I found that stem cell research was not taught to scientists but to those studying religion. That is fine, but scientists should be talking about the big idea in science in this country at the moment. I invite colleagues to ask whether stem cell research is being discussed in the schools they visit.
	Another reason for the falling numbers of science students is the funding arrangements for research and teaching in this country. Departments often nick money out of their research budgets to pay for teaching. Strange ratios have developed for different subjects, but nobody seems to know why one subject gets more for teaching than another. I am sure that there is an explanation, but it is not convincing in terms of the overall visionary economic plan that we have to increase the number of students in some areas. Nor can anybody tell me how many physicians, mathematicians or biotechnologists we will need. There is no overall plan, but we need one.
	We must also be honest and admit that not all universities can do everything. That is a brave thing to say, but every region can provide the surety that, whatever subject someone wants to study, they can find a course that they can follow within easy travelling distance of home—I shall not go into all the reasons why someone might want to stay at home or why they should not do so. We need to take hold of the regional development agencies and take something from them—not just money but some of their people, who could interact with others on a regional affairs committee or some such body to solve our infrastructure problems in order to ensure that the subjects are taught. We will never have enough money to teach every subject that we want to teach in universities. That is a hard thing to say and believe. Yes, we will get more students; we want more graduates and we want more of them to go out into the business world and into pure blue skies research. We must allow for that on a regional basis, although I do not see it happening in some RDAs.
	Policies must not dictate that research is the only thing that is important. A vice-chancellor once told me, "Forget teaching. Give the students 20 minutes and then walk out and get on with your research. That is much   more important." We must not have that. We must create structures in which very good teachers just teach and do not do research, and vice versa. We must work out such interaction on an original basis.
	A vice-chancellor who does not live far from me once said, "If you were starting the university system in this country over again, you would not have Essex and Norwich universities down the road from each other." Both Essex and the university of East Anglia have had to close physics and other subjects because neither is big enough separately. Together, they would be dynamite. We have a long way to go to get such things going. All   the restructuring in universities at the minute is demoralising without a bigger, visionary picture.
	The Budget opens up all these questions. For the first time in my life we are beginning to hear serious discussion about science, technology and engineering. There is a serious belief in our Government about using knowledge to create the businesses and wealth that will not only provide jobs, excitement and enthusiasm throughout people's lifetimes, but enable us to compete in the world markets, which are becoming tremendously serious. We can do it, and this Budget is the first line in the sand.

Phil Willis: I begin by thanking the Secretary of State for Education and Skills for her comments about our teachers and lecturers. I share the view that in most schools, colleges and universities, to which the hon. Member for Norwich, North (Dr. Gibson) referred, an excellent product is delivered to our young people, and we should celebrate that rather than always try to find reasons to denigrate.
	I welcome the admission by the hon. Member for   Westmorland and Lonsdale (Mr. Collins) that the Conservative Government made a fundamental error in introducing compulsory competitive tendering for school meals. I am sure that he was referring to that fatal mistake of saying what matters is how cheaply school meals can be provided rather than their quality. The hon. Gentleman has always been honest enough to admit the huge mistakes that the Conservatives made during their 18 years in office.

Jim Cunningham: Does the hon. Gentleman agree that it has taken the Conservatives a long time to admit that?

Phil Willis: One always welcomes a repentant sinner; that is much more important.
	The hon. Member for Norwich, North made a powerful and thoughtful contribution, as he does to any education debate. However, I wondered when he would get to several elements of Government policy that move us in the opposite direction. The recent publishing by the Office for Fair Access of the universities that are to charge so-called differential fees reveals that the full £3,000 top-up fee will be charged for 91 per cent. of courses. I do not believe that that is a differential. That means that there is a new flat-rate fee of £3,000 in our universities. I had hoped that the hon. Gentleman would say what impact that will have and how it will detract from the ambition to attract the young people whom we want to go to university. Are we to retrench a middle-class higher education system, which he and I would decry?
	I also wanted the hon. Gentleman to say something about the letter from the Secretary of State to the Open university and to Birkbeck. During our debate on higher education last year, we were promised a review of part- time students and funding, which would start with work at the Open university and Birkbeck. The review, however, concluded that they will not receive a single extra penny to support part-time students, and both institutions will regard that as a betrayal. As we move towards a higher education market in which more students study part-time—they will be earning and learning—everyone, whatever their political party, must address the issue.

Peter Bottomley: While the hon. Gentleman was speaking, the Secretary of State was shaking her head. Would he allow her to intervene and explain that all the reports that the Government would not help Birkbeck and the Open university were wrong?

Phil Willis: I am always happy to allow the Secretary of State to intervene if she wishes. That is her prerogative.

Ruth Kelly: We are working with the sector, and I   believe that the Higher Education Funding Council is working with the Open university to look at the widening participation premium available to part-time students. We want to see if we can promote that agenda. As a consequence, I am hopeful that the Open university finances will improve, and I hope that the hon. Gentleman takes that into account.

Phil Willis: I am grateful to the Secretary of State, but the hon. Member for Worthing, West (Peter Bottomley) will note that rather than having found a solution, she is hopeful of finding one. To be fair to her, the OFFA letter to the Open university and Birkbeck rules out any additional resources to support part-time students next year. That is the starting point.
	In response to the hon. Member for Norwich, North, after the general election, all hon. Members must revisit the issue of higher education. I do not believe that our debates on the Higher Education Act 2004 resolved anything; they merely fudged the funding issue. We did not address the purpose, function and shape of higher education and its relationship, not only with further education but with the 14 to 19 sector. If we are to meet the 21st-century challenges that the hon. Gentleman identified, we must undertake a radical review of post-14 education through to higher education and level 4 provision. I find that an exciting, not a negative, concept, and I hope that all political parties will support it.
	No one knows what will happen to them after the   election or what role they will have in the House. For the past eight years, however, I have attended the annual ritual of the Chancellor's Budget. I was very impressed the first year, but less impressed the second. I may have become a little more cynical and a little less gullible. [Interruption.] I am grateful for the confidence of the Minister for Lifelong Learning, Further and Higher Education that I am not a cynical person. I am not Welsh either. However, after 50 successive quarters of growth and the proud boast that our economy is now outperforming virtually every other economy in the world, why do our students have to incur massive debt to finance their university education? Why do the elderly have to pay for care in their old age, why do we all have to pay for simple health measures such as eye checks and dental checks—if one can get a dentist—and why is it not possible to guarantee our poorest children a simple nutritional meal at lunchtime unless a celebrity chef intervenes? Why, when our country was infinitely less wealthy, were all those services free? I am often asked that question by my constituents, but it is extremely difficult to answer.
	It is not until one sifts through the fine print of the Red Book that one realises that all is not as it appears. The Chancellor has created a sophisticated illusion that we are all winners, but in reality he has produced a Budget in which, to pay for the increases for pensioners, schools, child care, stamp duty relief and next year's bus passes for the elderly, he has assumed income that will be hard to guarantee and even harder to sustain.
	I shall give one example. The Chancellor has assumed a £2.825 billion tax receipt over the next three years by   clamping down on fraud and tax avoidance. Considering that this is the ninth Budget presented by the present Chancellor, one could be forgiven for asking why he has not already dealt with such massive tax fraud if it is so obvious.

Kelvin Hopkins: The hon. Gentleman is making a strong case. It has been estimated that there is a tax gap of some £37 billion. The Chancellor could go much further with more tax inspectors and more rigorous tax inspection, and draw in much more revenue than he is doing with his current proposals.

Phil Willis: I am grateful to the hon. Gentleman for his intervention, but if it is so straightforward to recover all the money being lost through tax avoidance, why has it taken nine years to do so? If it had been done sooner, we might not have had to impose fees on university students. And if there is another £35 billion out there, we would not need the James review, would we? We could pour that sum into the coffers.
	What happens if the Chancellor is not successful? He has not been successful yet in driving down that fraud. Presumably, that is why pensioners are getting a £800 million rebate for only one year, and why taxes will have to rise to meet any shortfall. We should not assume that any of the proposed benefits announced last Tuesday can be sustained without extra borrowing or increased taxation. Equally, we should not assume that all the benefits that the Secretary of State for Education and Skills announced today or that were announced in the Budget are as transparent as they first appear.
	The Liberal Democrats support and applaud extra investment in education. On the surface, the Budget is brimming with extras. As a trustee of the e-Learning Foundation, I particularly welcome the additional £300 million contribution from the Treasury to the e-Learning Foundation. That is a significant and welcome sum. It will help lever additional funds from parents and business to tackle the huge digital divide that exists in parts of the country.
	There was an impression that the introduction of IT in schools had been completed, yet in 2004 one third of our secondary and primary schools failed to meet the target for the number of computers they should have, and half of all computers in our primary schools are at least three years old. The New Opportunities Fund money that went into providing much of that equipment was seen as a one-off, but unless we can sustain that technology and get head teachers to continue to invest in it, all we will do is build in obsolescence, which will do nothing to bridge the digital divide. The stark realisation has dawned, and the Chancellor admitted in his Budget speech that we need to provide laptops for children to take home and use there.

Desmond Swayne: Has the hon. Gentleman seen the Royal Economic Society report published today, the questions that it raises about the value of technology in education, and the finding that the more pupils used computers, the worse they got at the basics of arithmetic?

Phil Willis: I confess that I have not read that report, but I have seen the announcements about it. We should not give way to that sort of neanderthal approach to information technology. The idea that using the internet and the huge resources available to youngsters in their home and in the classroom takes away from other aspects of learning is a nonsensical concept.
	Many youngsters have internet access in the home, but 2 million children do not. Those who have access to the internet at home have a whole world of information at their fingertips. We should not deny those opportunities to children who are often the most needy. Research by the e-Learning Foundation shows that children of single parents are particularly at risk from digital exclusion, yet it is often they who would benefit most. Removing the digital divide is too important for any one party to address, and I hope that after the next election there can be an all-party taskforce to consider how we ensure that digital access is available to every child throughout the country.
	The commitment to primary school refurbishment is welcome. An additional £9.4 billion of expenditure to rebuild or refurbish half our primary schools over 15 years is ambitious, but the programme will not start until 2009, and without careful strategic planning at local level we may see what we have seen at secondary level—the development of a two-tier primary system, with thousands of schools still out of the programme by 2020.How do the Government intend to prioritise the primary school rebuild programme? Will it be done through local education authorities or will it, as happened with the secondary programme, be directed from the Secretary of State's office? Can the Minister confirm or knock on the head the impression that the new resources for rebuild will be given only to projects where extended school provision is offered? Will voluntary-aided primary schools be included in the programme? Where they serve communities with open admissions, as is usually the case in rural areas, will they receive 100 per cent. capital support or will they have to provide the capital element? That applies particularly to the Church of England, which is the main provider of primary education in rural areas. In other words, will the voluntary-aided capital programme and the capital programme for controlled schools come together?
	The development of new, exciting primary schools will make a real difference to the learning opportunities of our youngest children, but I think that the Secretary of State will agree that it would not make as much difference as allowing children to be taught in small classes by qualified teachers supported by trained teaching assistants. The Prime Minister often boasts about what the private sector has to offer in education, but the key selling point in any independent prep school prospectus is not about buildings but about children being taught in small groups. That is because any parent or teacher believes, as all the research confirms, that giving children greater individual attention when they are developing their learning skills pays massive dividends in later learning.

Desmond Turner: We would all agree that smaller class sizes are highly   desirable. However, as I am sure the hon. Gentleman accepts, per capita funding for students in the independent sector is at least double what it is in the state sector, and that is after this Government have practically doubled per capita funding. Class sizes of 15 would be marvellous, but how does he propose to pay for them?

Phil Willis: I am grateful to the hon. Gentleman, because I am coming to that point. It is important not to have fanciful economics in terms of how we will pay for election promises.
	The Government have done a good job as regards early years. We support the Sure Start programme, and it is good to hear Conservative Members say that they will support its continued roll-out. We support the extra 3,500 early years centres by 2010, and that will certainly be in our manifesto. But I ask the Minister this: why compromise that huge achievement by moving children from groups of eight, or at the most 12, in nursery classes to groups of 30 or more when they reach infant classes in primary schools? I think the hon. Gentleman would agree that that does not make sense.
	The School Standards and Framework Act 1998 said that there could not be more than 30 children in a class, but the response of the Department for Education and Skills to a recent parliamentary question shows that a significant numbers of classes in our infant schools have   more than 30 children in them. There are good explanations for that, so I do not think that schools are bypassing the policy. I think that there are about six categories under which children who arrive in an area may join a class and thus take its size above 30.
	If we are talking about investing billions of extra pounds into early years education, why compromise that if there is another way of achieving the objectives? Liberal Democrats have chosen to invest resources to reduce key stage 1 infant class sizes to 20. That would require employing 15,000 more infant teachers, so the project is large. We would pay for that by scrapping the   child trust fund. We have always made it clear that it is far better to invest in children when they are five and six than to give them something that they can cash in at the age of 18, so we have made a policy choice. We could use that £1.5 billion to give our youngest children the best chance that they have ever had at the beginning of their school careers.

Angela Watkinson: The aim of having infant class sizes of 15 is highly desirable, but if primary schools continue to admit similar numbers of children as at present while they are taught in classes of   30, it is logical that schools will need twice as many rooms and that the internal layout of schools will need to be completely reconfigured. How would the hon. Gentleman overcome that problem?

Desmond Turner: Liberals do not like minor details.

Phil Willis: With due respect to the hon. Member for   Brighton, Kemptown (Dr. Turner), either we will have a sensible debate in the House on an important issue, or we will not. The hon. Member for Upminster (Angela Watkinson) made a sensible intervention. I   actually suggested class sizes of 20, not 15, but the logic behind what she said was right. The Government are putting more than £9 billion into a primary school build programme, so we would prioritise that and ensure that additional classrooms were available to accommodate additional teachers.
	I also tell the hon. Lady that the demographic trend shows that the number of children coming into our primary schools is significantly down. Something in the region of 6,000 classrooms and teachers will become available simply because of falling rolls. It is logical to the Liberal Democrats that rather than allowing those teachers simply to go out of the door through redundancy or retiring early, let us use them as part of our recruitment of 15,000 teachers and ensure that they are working with our youngest children to give them the start in life that only the wealthy could afford in the past. The Conservative party and the Government might not accept that that would be a proper use of the £1.5 billion that the Chancellor has set aside for the child trust fund,   but the Liberal Democrats will go into the election saying that giving children a flying start to their education is our priority.
	I was pleased that the Chancellor indicated in his Budget statement that he was adopting a Liberal Democrat policy that he heard first at a conference of the Association of Colleges—I think that the Economic Secretary to the Treasury was at the conference this year. I spoke at the conference about a policy of colleges for the future. The Liberal Democrats have always asked what is the point of renewing all the schools when what is often needed in communities is new colleges. To be fair, the Chancellor has come on to that ground and given an extra £350 million for the final two years of the spending review, which will make a total amount of £1.5 billion. That welcome new money should be seen as a down-payment. I hope that, when the Secretary of State makes her statement on skills at the Dispatch Box tomorrow, she will say more about that capital investment in our stock. If we could bring together the   colleges for the future and schools for the future programmes and view them as one entity, we would do an enormous amount to build an infrastructure for our young people in the future.
	The Liberal Democrats would like the £5 billion of capital resources that is earmarked for the increasingly discredited academy programme to be used to rebuild and build facilities for 14 to 19-year-olds. We will make a quantum leap in the 14 to 19-year-old programme to   improve our depressing figures for truancy, school exclusion and so on. If we give young people a flying start and wonderful options at the age of 14 to 19, including the exciting things that the hon. Member for Norwich, North mentioned, we will keep kids in our schools and in learning, feed into industry and higher education, and have well-motivated and qualified young people.
	When the Economic Secretary winds up, perhaps he could say a little about whether the 35 per cent. ceiling on what the Learning and Skills Council can give as a capital grant for rebuilding a college will be retained or whether colleges will get access to 100 per cent. capital funding in the same way as schools if they rebuild their kit. It is grossly unfair that one sector gets 100 per cent. funding from the state and another, which we regard as crucial, does not.
	Although the Chancellor has at last acknowledged the need to invest in further education stock, today revealed another example of the scandalous injustice that affects two thirds of our 16 to 19-year-olds—the 700,000 people who study in FE colleges. Those young people, who disproportionately come from poorer, less traditional and less affluent backgrounds, are short changed by the sum of approximately £500 a year—a loss of some £500,000 to the average FE college.
	The Budget was an opportunity to make some progress towards the commitment, made during the passage of the Learning and Skills Act 2000, that schools and colleges that delivered the same programme would receive the same funding. Five years on, the gap is 12 to 14 per cent., despite initial claims to the contrary by the Minister for Lifelong Learning, Further and Higher Education in a parliamentary answer to the hon. Member for Finchley and Golders Green (Dr. Vis) on 21 February. When I challenged the Minister, he admitted in a parliamentary answer on 17 March that he   had conveniently dealt with only part of the funding gap in his reply to the hon. Member for Finchley and Golders Green. He stated:
	"I recognise that there is more to overall levels of funding than differences in funding rates and I acknowledge that there are other important differences between school and FE funding."—[Official Report, 17 March 2005; Vol. 432, c.447W.]
	We welcome that acknowledgement because we have never had it previously.
	We are committed to creating a level playing field between schools and colleges for revenue funding. However, it is difficult to quantify the problem when   Ministers refuse to provide accurate information about the funding gap. Will the Secretary of State agree   to place in the Library—it would be good if she   did it now—the recently completed report of the Learning and Skills Development Agency, which the   Learning and Skills Council commissioned? It quantified the funding gap and is the definitive research into that. We therefore know what we are talking about. I hope that when the Economic Secretary responds, he will give a commitment about when that research will be published so that we can all have access to it.
	Further education is constantly left out when we discuss education in the House but it is crucial if we are to deliver the skills agenda that the country needs. It cannot be right that lecturers in FE colleges are paid on average 8 per cent. less than teachers in schools, and that gap must be closed. It cannot be right that the facilities in our FE colleges are often outdated and overcrowded, or that enrichment programmes are often decimated in order to make a budget's ends meet. This hardly shows a commitment to world-class vocational options.
	Yet, as sharp-end delivery struggles for resources, there appears to be little brake on the spiralling cost of administration. Administrative costs for the Learning and Skills Council have now rocketed to a massive £330 million, with additional administrative costs added to almost every programme. I hate to give succour to the hon. Member for Westmorland and Lonsdale, but these spiralling costs represent a real issue that needs to be addressed. There is no one else in the Chamber at the moment who sat on the Learning and Skills Bill Committee, but we were told at the time that huge savings would be made by moving from the Further Education Funding Council and the training and enterprise councils to the new Learning and Skills Council. However, in 2000—the last year in which they operated—the FEFC spent £29 million, and the TECs £118 million, on administrative costs. Yet, four years later, the administrative costs of the Learning and Skills Council have spiralled to £330 million. That is a huge additional cost, yet we were told in 2000 that there would be a £50 million reduction as a result of the introduction of the LSC.
	The 47 regional learning and skills councils have grown like Topsy. They now have huge bureaucracies to deal with relatively small amounts of money, yet any major decisions get referred to Coventry. The adult learning inspectorate now spends £28 million a year, and   the new Sector Skills Development Agency—the Government's pride and joy—now has a budget of £188 million over the next three years. I want to know what all these organisations actually do to add value to the front-line services that are delivered in the workplace and in our colleges.
	The Liberal Democrats believe that it is time for a radical realignment to simplify the structure and to amalgamate the Learning and Skills Council and the Sector Skills Development Agency with the regional development agencies to form single regional skills and development agencies. We need to slash red tape and bureaucracy, and use the savings to bridge the funding gaps in colleges so as to provide the resources to skill our work force. Further education and the skilling of the nation are crucial issues, and we are delighted that the   Secretary of State is to come to the House tomorrow with a new statement. In the meantime, I   hope that the Minister will be able to respond to a number of the issues that I have raised today.

Desmond Turner: I   endorse the remarks made by my hon. Friend the Member for Norwich, North (Dr. Gibson) about the   crucial effect of the investment that the Government have made in science and its spin-offs. The hon. Member for Worthing, West (Peter Bottomley) made a rather cheeky intervention on my hon. Friend and asked him to name a scientist who would wish to see the return of   a Labour Government. I have to say to the hon.   Gentleman that I know many scientists—some of   whom are extremely distinguished—and when I put to them the prospect that there might be another Conservative Government, their reaction is either to recoil in horror or to laugh with derision, because it is total nonsense and an absolute oxymoron. There is no comparison between the Conservatives' proposals and the seriousness with which this Government have addressed the issues of higher education and the feeding through of the results of higher education and research into innovation and into our economy, the growth of which will have doubled as a result of this Budget.
	Conservative Members have made much of the £35 billion, or rather they have tried to make very little of it. They have tried to pretend that it is not there or that it is something that we have dreamt up to beat them about the head with. Can I assume, therefore, that Conservative Front Benchers are repudiating the statements of the shadow Chancellor? If I understand him correctly, he has said that at the end of another six years a Conservative Government would be spending £35 billion less than us. If that is not £35 billion of cuts, exercised at the rate of approximately £6 billion a year, what else is it, or does the Conservative party not understand the meaning of the English language?

Peter Bottomley: Will the hon. Gentleman give way?

Desmond Turner: Yes, it could be amusing.

Peter Bottomley: Is the hon. Gentleman the only Member of the House who did not see the photographs the day after his Chancellor and his Prime Minister had to face a simple question? The person who saw the humour was the Chancellor; the person who looked as though he had egg on his face was the Prime Minister.
	Does the hon. Gentleman agree that that is probably the last time the Prime Minister will allow an independent photographer to attend such proceedings? We will be back to the stage-managed press conferences typical of his leadership. The fact is that the Chancellor understood the difference. It is a great pity that the hon. Gentleman and the Secretary of State for Education and Skills do not.

Desmond Turner: It is nice to know that Conservative Members see the relevance of serious politics. It is quite simple: £35 billion less is £35 billion less. They cannot talk that away, and they certainly cannot laugh it away.
	The Opposition have described the Budget as a vote now, pay later Budget, as if the Chancellor had introduced a few populist measures to tempt people into voting Labour. Conservative Chancellors never did that, did they? Perish the thought. I am surprised, given the nature of the criticism that the Opposition have mounted, that they have not put forward their own coherent alternative Budget. It is completely missing.
	In the Red Book, we have a coherent, joined-up financial statement whereas all we have had from the Opposition is what can best be described as a few cheap tricks to try to tempt the grey vote back into the Conservative fold. I seem to remember that a previous Conservative Government broke the link between pensions and earnings. In so doing—in the high- inflation times that they presided over, with high wage inflation—they cheated pensioners out of about £22 a week per head.

Desmond Swayne: Will the hon. Gentleman give way?

Desmond Turner: Happily. I love Conservative interventions.

Desmond Swayne: Does the hon. Gentleman recall that, in those times of high inflation, prices were rising faster than earnings when the link was broken?

Desmond Turner: And it was under a Conservative Government. The hon. Gentleman has made my point.
	The Conservatives are making a virtue of restoring the link, but we have already restored the link in respect of the pension credit limit. We have invested more in pensions and supporting the poorest pensioners than the cost of the link. By the time pension credit limits have risen by the amounts already advertised, there will be   few people with any severe need who are left out. All the Conservative proposal would do is give money to   those pensioners who do not need it and take it from those who desperately do. That can hardly be described as an antithesis of a vote now, pay later proposition.
	The Conservatives have offered us another bonus on council tax, but they forget two things. First, under a Conservative cuts regime, councils would get less Government grant, so council tax would go up much more. Therefore, even if pensioners got a £500 discount, it would be £500 off a much higher council tax, and because this is a zero sum game, the rest of council tax payers would pay much higher amounts to pay for that. One cannot just address one little item in isolation from the local government taxation system; one must address the whole complex issue.
	A Conservative Government created the council tax, and it is a deeply flawed tax—most people would agree with that.

Angela Watkinson: The hon. Gentleman referred to the £500 discount, which the Conservative party in government would give to every pensioner household over the age of 65. If he can do simple arithmetic, he will know that £23 billion of reinvestment in schools, hospitals and other public services, plus £8 billion less borrowing to avoid Labour's third-term tax rises, plus £4 billion of tax cuts adds up to the magical £35 billion. Of that £4 billion of tax cuts, the first that we have announced is the £500 council tax discount, which has been carefully costed at £1.3 billion, and we still have a   further £2.7 billion to announce—quod erat demonstrandum.

Desmond Turner: That is fantasy arithmetic. One cannot give away—or pretend to give away—that much without absolutely slashing the rest of public expenditure.

Angela Watkinson: Will the hon. Gentleman give way?

Desmond Turner: Not again.
	The Conservatives say that they will protect—not enhance, so it is not much of a promise—health and education, which leaves only about 60 per cent. of Government spending. I calculate their tax cuts at around 10 per cent. of public spending. That 10 per cent. will therefore be taken off only 60 per cent. of public spending, so the cuts will be very deep. To return to my point on council tax, that is precisely where the Conservative proposals will hit hard.
	The hon. Member for Upminster (Angela Watkinson) says that the Tories are bidding £500. If that is not a vote now, pay later proposition, I do not know what is.   Council tax needs a thoroughgoing review. The Chancellor has offered his council tax discount on a one-year basis, for a very good reason: the whole system needs review, which is what this Government will do in their next term. They want to achieve two things: to make the basis of the tax more progressive, and, given that it is far too narrow—

Phil Willis: This is dangerous territory.

Desmond Turner: Yes, I know. Ability to pay would also be taken into account, which is not the case currently, apart from in relation to benefits. I would therefore be confident that a pensioner discount would last not just for the year after the election but in perpetuity. It needs to be done in the round, however, as it is a complicated issue, and cannot be done as a little gesture.
	Another of the proposals that I have heard launched was free care for the elderly. That great proposition, which I am sure we would all love to offer, has been promised by the Leader of the Opposition. However, those who read the Conservative documents carefully, as I have, will see that it is not quite as simple as that. The Conservatives are promising to pay for care for the elderly only if the elderly person concerned has first paid   out of his or her own resources for three years. That means having to have well over £20,000 in liquid assets, and also having to live for three years. It is a sad fact of life that the average life expectancy of those who   go into residential care is less than three years. That too is something of a false promise.

Jim Cunningham: I may have misunderstood my hon. Friend, but he seems to be suggesting that this is an additional means tax introduced by the Conservatives. Am I right in my assumption?

Desmond Turner: Yes, I think so. It is a means test under which only those who are already fairly wealthy receive any benefit. But, as my hon. Friend knows, that is a familiar pattern in Conservative promises.
	Let me say something about environmental taxation. I am sorry that the Minister has just left the Chamber, because the next part of my speech was intended for him.

Desmond Swayne: Save it!

Desmond Turner: No.
	We heard some severe criticism of the Budget from my hon. Friend the Member for Nottingham, South (Alan Simpson) on Budget day, which I felt was a little curmudgeonly. It is not surprising that this Budget does   not contain much in the way of major new environmental fiscal measures. Indeed, it would have been foolish to include such measures at a time when the Government are undertaking a complete review of climate change policy. Fiscal policy is obviously a central plank of the delivery of that policy, so it would be silly to make major changes in this Budget. The next Budget—the next Labour Budget—

Andrew Love: Just after the election!

Desmond Turner: Exactly. I expect that Budget to be quite different.
	Let me make a few suggestions to the Treasury. Let me suggest a few fiscal measures designed to combat climate change. I am happy for us to maintain the climate change levy and the renewables obligation to promote energy conservation and the deployment of renewable energy, but I think we must enhance those measures considerably. We must beef up the renewables obligation, or lay on top of it something that is much more powerful in encouraging new, renewable, non-carbon-emitting electrical generation technologies into market deployment.
	The Royal Society recently suggested a carbon tax, and the Science and Technology Committee has suggested a comprehensive system involving a carbon tax and a carbon tax credit. Electrical generators emitting carbon dioxide would pay a carbon tax—at present they constitute about 96 per cent. of our generating capacity—while generators that do not emit carbon dioxide and operate on the basis of renewable resources would receive a carbon tax credit.
	A carbon tax would generate the resources needed to supplement and speed up investment in renewable energy. This is not a stealth tax but a "behaviour tax", which is intended to punish environmentally bad behaviour and to reward the good. We could profitably extend that principle throughout the whole range of environmental taxation; indeed, it is already embodied in some existing taxation measures.
	We must also address transport. We cannot go on not increasing what is, in effect, a carbon tax on fuel—the fuel escalator—year on year. To be fair, it was introduced by the Conservatives and I totally support it. We all know that it reached the limit of public acceptability a few years ago, since when the Treasury has been a little leery of increasing it. We are going to have to bite the bullet sooner or later and start progressively increasing it, but again, we can use corresponding carrots. For example, we can go further with lower taxation for environmentally friendly fuels, and we can probably do more to stimulate the production and sale of biofuels.
	We could also do more by using the proceeds of carbon taxation to accelerate the development and deployment of hydrogen fuel transport initiatives—on which, of course, we would charge no tax at all, thus making such initiatives very much more attractive. We have to overcome the enormous hurdles of getting the public to accept the use of hydrogen and of setting up   distribution, but once they are overcome, such initiatives have the potential to reduce our carbon emissions by about 50 per cent. That is a very worthy long-term aim, and fiscal measures will be a key driver in achieving it.

Kelvin Hopkins: I am very interested in what my hon. Friend is saying, which I broadly support. Recent research suggests that a particularly efficient way to develop renewables is to build energy-efficient buildings, which are more economical pound for pound than wind generators, for example. Does he think that the Government need to take more seriously building installation and technology that saves energy?

Desmond Turner: I thank my hon. Friend for that intervention, with which I broadly agree. There is a great deal more that we can do in terms of energy conservation, and in fact this Budget contains further measures to that end. I want us to go further and to introduce much more stringent building regulations. The technology for zero-emission buildings exists now. We should strongly encourage its use, and we need more fiscal measures to do so.
	Returning to transport, we have made a start by implementing differential road taxation for vehicles according to their CO 2 emissions. I thoroughly endorse this approach but I would be inclined to go very much further, starting with a zero rate for vehicles that emit no CO 2 at all, escalating to quite punitive rates for "Chelsea tractors" that emit grossly excessive amounts for no useful purpose whatsoever. In fact, such vehicles are usually used to drive children to school in Chelsea.
	Aviation, however, is an outstanding problem for which no identifiable technical fix exists at the moment. There is a technical fix in sight for all the CO 2 that we currently produce, except that produced by aviation.

John Wilkinson: The hon. Gentleman is talking nonsense, as he has been for a considerable period of time. Substantial improvements have been made in the fuel efficiency of power plants, particularly in respect of fuel consumption. Such technological improvement will continue, as it will in the aerodynamic sphere to reduce aerodynamic drag and as it will in the structural sphere to ensure that composite and other materials offer lighter but stronger structures. Could the hon. Gentleman please get something right?

Desmond Turner: I am perfectly well aware of everything that the hon. Gentleman mentions, but it does not alter the fact that we use air transport far more than we ever did or that CO 2 emissions from air transport have approximately doubled over the last 10 years and are likely to double again. It represents a very large source of CO 2 and I was making the point that it is the only major area of energy use where we cannot see a technical means of avoiding CO 2 emissions.
	After the Hindenberg disaster, I imagine that it would be pretty difficult to persuade passengers to travel on a plane fuelled by hydrogen and even if they were so persuaded, there would not be much room for them. Unfortunately, even in liquid form, hydrogen is so light that it would virtually fill the fuselage, leaving little room for passengers. That is another awful technical difficulty to be overcome before we can achieve non-carbon-emitting aviation. I would like the Government to fund research into that subject in order to find a way forward.
	The measures I have outlined are more radical than those contained in the Budget. They are for the next Budget, but I welcome some of the measures in this Budget. For example, the reduction of VAT to the   minimum on micro-CHP plants has delighted the British combined heat and power industry. Micro-CHP has the capacity, if it is widely used, to save millions of tonnes of CO 2 . The same applies to heat pumps. Instead of losing the heat in extraction, it is recovered and kept within the building—a very useful energy conservation measure.

Desmond Swayne: On a point of order, Mr. Deputy Speaker. Is it in order for an hon. Member to deliver a speech entirely fuelled by gas?

Mr. Deputy Speaker: I really do not think that that is a point of order for the Chair.

Desmond Turner: The hon. Gentleman should know that.
	I greatly welcome—

Mark Francois: Further to that point of order, Mr. Deputy Speaker.

Mr. Deputy Speaker: I have heard enough of such points of order for the time being and would like Dr.   Turner to continue.

Desmond Turner: Thank you, Mr. Deputy Speaker.

Mark Francois: Will the hon. Gentleman give way briefly?

Desmond Turner: Oh, I suppose so.

Mark Francois: I am grateful to the hon. Gentleman for his courtesy in giving way. May I say that my hon. Friend the Member for New Forest, West (Mr. Swayne) has been slightly unfair to him? His speech has not been entirely fuelled by gas; a large part of it has been empowered by wind.

Desmond Turner: How very droll.
	I also welcome the landlord's energy-saving allowance and its extension to solid wall insulation. Again, it may not sound very important, but 50 per cent. of our housing stock cannot be insulated by cavity wall insulation because it does not have any cavities. I live in   such a house myself. There is a desperate need for the   development of cheap and easily used materials because the existing technique of using dry lining is quite   expensive. The allowance will help landlords, particularly in respect of houses of multiple occupation, of which there are many in my constituency. Many are old, draughty, solid-wall buildings and very difficult to insulate. The grant will end up saving potentially thousands, if not millions, of tonnes of CO 2 output.
	Reduced taxation for biodiesel and bioethanol is welcome but I should like a more rigorous attack on biofuels in future. I have slightly digressed from education, the principal subject of today's debate, but I   make no apology for that as the subjects are not that strict. It is also clear that many Members on the Opposition Benches badly need educating.

Mark Simmonds: It   is traditional to say a few courteous and polite words   about the previous speaker, but I struggle to find complimentary words about the contribution of the hon. Member for Brighton, Kemptown (Dr. Turner).

Peter Bottomley: My hon. Friend should at least give the hon. Member for Brighton, Kemptown credit for not raising the question of unemployment. It is sad that unemployment has risen by more than 8 per cent. in his Brighton constituency over the past year.

Mark Simmonds: I am grateful to my hon. Friend for that intervention. I was not aware of that fact, so he has added an interesting statistic to our debate.
	The Government erroneously make great play of the   fact that they alone are responsible for economic stability, growth and sustainability, whereas in fact, post-1997, they immediately built on the successful macro-economic policies of the previous Conservative Administration. They used that economic legacy as a foundation for what will ultimately be unsustainable and wasteful public expenditure.

Kelvin Hopkins: The hon. Gentleman talks about the   Conservatives' successful management of the macro-economy. Am I mistaken in thinking that the   Conservatives entered the exchange rate mechanism and caused economic disaster in Britain? Is not it merely climbing out of that deep hole just before the election that he is claiming to their credit?

Mark Simmonds: I am grateful to the hon. Gentleman for making those points and I have two things to say in response. First, I seem to recall that at the time the Labour Opposition were extremely supportive of our entry to the ERM. Secondly, the Chancellor admitted in   his Budget speech that we have had sustainable economic growth for 50 quarters. That is about 12 and a half years, which takes us well beyond the incumbency of the present Government, so there is no doubt that my right hon. and hon. Friends who had charge of the Treasury for the 18 quarters before 1997 should be given credit for turning our economy around after our exit from the ERM.

Desmond Turner: The hon. Gentleman is missing a lesson from history. No Conservative Government have ever succeeded in sustaining economic stability for that long. They have always blown it with irresponsible tax cuts that took money from the poor and gave it to the rich.

Mark Simmonds: I shall respond to the hon. Gentleman but then I want to move on quickly. One of the fundamental reasons why Conservative Governments have often struggled with the economy is that—probably with the exception of the transfer of power that will happen on 6 May—every Conservative Government have inherited a shambles from the previous Labour Administration. [Interruption.] One example is 1979 and another is 1970.
	Despite the Government's claims, almost all independent commentators believe that there is a black hole in the Chancellor's figures and thus a necessity for fiscal consolidation and tightening. The Government will need to cut spending or raise taxes—perhaps both. They will have to retreat from their current expansionary stance on fiscal policy and control their spending. If an election were not looming, taxes would now be increasing against the backdrop of a faster-than-anticipated deterioration in the Government's budgetary position.

Kelvin Hopkins: The hon. Gentleman seems to be suggesting that we should deflate, yet that would make the problem worse—if indeed there is a problem at all—by raising unemployment, thereby raising benefits and reducing tax revenues.

Mark Simmonds: I am not saying that. If the hon. Gentleman had been patient, he would have heard that I am advocating the control of public expenditure and a tightening of the fiscal deficit, which will bring public expenditure under control without harming the delivery of public services. Such a policy has been carefully set out by my right hon. Friend the shadow Chancellor, building on the foundation of the thorough and detailed James review.
	The fiscal deficit in the United Kingdom last year was greater than that of France, Germany, Italy and Canada. The deterioration in the UK's fiscal position since 1999 is bigger than in any G7 country. Indeed, the International Monetary Fund has advised that a cut in expenditure of £12.5 billion is required, equivalent to 3.5p on the basic rate of income tax; in other words, a fiscal adjustment of 1 per cent. of gross domestic product—an enormous sum. Almost all informed commentators have estimated growth forecasts below the Chancellor's, which currently stands at between 3 and 3.5 per cent. That is well above consensus expectations, which are much closer to between 2.5 and 2.75 per cent.
	When I looked at the detail of the Chancellor's forecast I was shocked to see that growth in investment spending and exports looked wildly optimistic, at a figure of between 6.75 and 7.25 per cent. Even if we accept that world trade picked up last year, we see that UK exports grew by only 2.6 per cent. The deteriorating budgetary position has been facilitated by two factors: faster than projected growth in spending and a shortfall in tax receipts. That shortfall was hardly surprising given that between 2001 and 2003 growth failed to reach 2.5 per cent. per annum, on which the public finances arithmetic is based. Nothing was done when that growth figure was not hit. That is why public borrowing is deteriorating and the Chancellor has to keep revising his borrowing forecast.
	It was clear from the Budget statement that the Chancellor had to start tightening his fiscal position immediately, which he supposedly did by penalising businesses such as the oil industry. Alternatively, had he loosened his fiscal policy it would have increased pressure to raise interest rates, as the hon. Member for Luton, North (Mr. Hopkins) correctly said, which could have triggered a further sell-off of sterling. The Government's net cash requirement has been revised upwards since projections three months ago suggested precisely the opposite of the fiscal tightening that the Chancellor claimed in his Budget speech.
	We hear much about the Government's success in job creation. The figure that is often bandied about is 2 million jobs. However, the House may not be aware that 927,000 of those jobs have been created in the public sector since 1997—jobs bought with taxpayers' money, not created by economic growth. Public sector employment growth continues to accelerate. Of course, some of those jobs are extremely valuable and worth while. The people taking them make an extremely valuable contribution to the delivery of public sector services in all our constituencies.
	The problem is not just that public sector jobs have   been purchased by taxpayers' money. In the manufacturing sector, 1 million jobs were lost between 1997 and 2005, yet in the previous seven years, between 1990 and 1997, only 500,000 jobs were lost—half the amount. Those job losses are a direct result of the UK's losing its competitive edge in a globalised marketplace.

Andrew Love: Does the hon. Gentleman accept that, at a rate of nearly 75 per cent., employment is at a record level? Does he accept the contribution that the Government have made in getting people back into work?

Mark Simmonds: I welcome any economic policies that stimulate employment and stop the unemployment trend. I accept that there has been significant growth in the number of people in work as a result of some of the Government's policies. However, I argue that that economic growth was built on the foundations that the previous Conservative Administration put in place after the UK fell out of the ERM. As I shall say later in my   remarks, I want to ensure that, especially given the   competition from China and India, we remain competitive in a globalised marketplace. We cannot sustain a situation where there is an increasing tax burden, an unsustainable increase in public expenditure and increases in regulation and bureaucracy that make us less competitive in the global economy. That position is evidenced by the United Kingdom's trade deficit.
	Last year, the trade deficit was £57.9 billion—five times worse than in 1997. The UK's overseas trade deficit in January alone was £5.2 billion for goods and £3.7 billion for goods and services. The UK has not become more competitive since 1997, but significantly less. Our productivity is 11 per cent. below the G7 average. Our only saving grace is that we are efficient in comparison with the inefficient EU economies, but as I said in response to the intervention made by the hon. Member for Luton, North, competing with Europe is not where the main battle will be in the near future.
	An economy with high and increasing tax and low productivity that is increasingly uncompetitive is music to the ears of the business people in China and India. The UK must become more competitive, not less. Those two countries alone will account for 25 per cent. of the world's output in real terms by 2015. The Chinese middle class has just passed the 250 million mark— larger than the total population of the United States. Increasing tax, spending and regulation, poor public sector productivity and minimal reform of public sector services are not the answer. Both being economically competitive and upskilling our work force is the answer to those challenges.

Kelvin Hopkins: The hon. Gentleman correctly identifies that the trade deficit is substantial, but is that not simply a result of the appreciation in the value of sterling? Is not the fact that our currency is too strong causing us problems? Is that not much more significant than marginal changes in productivity and increasing training, although that is important?

Mark Simmonds: I accept what the hon. Gentleman says. The increase in the value of sterling has played a   role—as, indeed, has this country's consumer boom,   which has sucked in imports, thus having an impact—but in my view, the significant contribution to   the deteriorating trade deficit is our lessening competitiveness, compared with not just our European competitors, but countries around the world.

Adrian Bailey: I accept that we will face enormous pressure from China, India and the emerging economies, but does the hon. Gentleman agree that the one way to succeed in spite of that competition is to invest in education, research and added-value products? The only way to do that is to invest in our education system and in the ways outlined in the Budget. How does he square that with the proposed £35 billion in cuts, which, I notice, he has not mentioned at all?

Mark Simmonds: I thought the hon. Gentleman's intervention positive and constructive until, rather sadly, he became wayward and disappeared off the path towards the end. I totally agree that investing in education—from pre-school through to higher and further education, about which I shall say a little more later—is the key to producing a skilled work force, thus increasing productivity. Indeed, that is why the shadow Secretary of State for Education and Skills, my hon. Friend the Member for Westmorland and Lonsdale (Mr. Collins), made it clear that the Conservative party plans to spend more on education than the Government, for the very reason that we believe that education forms a fundamental part of building this country's economic success for the future. That is why he has been so successful in disseminating the Conservative party's education policy.
	In addition to the importance of upskilling the labour force, the Government trumpet their record on education, as the hon. Member for West Bromwich, West (Mr. Bailey) was trying to do. They rightly analyse that education is a key factor in raising aspirations and economic performance, but despite large sums of taxpayers' money going into schools in particular, the   significant improvement in school standards occurred between 1997 and 1999, when the Government   implemented their literary and numeracy strategies, while sticking to the previous Conservative Administration's spending plans. So without real, radical reform of the education system, there is no correlation between putting in additional public sector funds and driving up standards. That is evidenced by what has happened between 1999 and 2005.

Adrian Bailey: I appreciate the hon. Gentleman giving way for a second time. There was certainly an increase in literacy and numeracy standards—no doubt, as a result of the policies implemented during the time that he outlined—but he ignores the fact that in areas such as mine, where people have traditionally had few educational qualifications, a very significant increase in GCSE results has taken place during the past four or five years. That is only the result of current Government spending.

Mark Simmonds: I am afraid that I do not agree with the hon. Gentleman. Like him, I represent a low-wage, low-skill constituency where education is the key for people to escape from socio-economically deprived areas. I would argue that money alone is not the solution. We need more radical reform, including reform of the curriculum, so that those students who do not currently engage with it do so. That is why I   welcome the part of the Tomlinson report that the Government have welcomed. I can see no direct correlation that evidences and supports what the hon. Gentleman says.
	One of the Budget documents, "Long-term global economic challenges and opportunities for Europe", gives on page 48 a list of conclusions about those challenges, one of which is
	"the increasing importance of skill levels and flexible labour markets".
	There has been virtually no progress on the former since the Government came to power and, without question, the labour market is less flexible, more bureaucratic and therefore less competitive than in 1997. I shall draw on some examples from my constituency. In rural and coastal Lincolnshire, we suffer from low aspiration at school, and when coupled with poor penetration from the higher and further education sectors, the work force struggle to upskill, thus exacerbating and perpetuating a low-skill, low-wage economy. Some 50 per cent. of the work force have no qualifications, as opposed to the   national average of 29 per cent.
	I am pleased that the Secretary of State for Education and Skills announced that £1.5 billion would go into the FE sector. I hope that, unlike most of the Government's announcements, some of that money will find its way to my part of Lincolnshire, where people with a desire to   upskill will be able to do so. That factor, when coupled with poor access and the seasonality of employment, causes real socio-economic problems. In Ingoldmells, a resort just north of Skegness, there is a 600 per cent. increase in unemployment out of season and a 30 per cent. change each year in primary school rolls owing to seasonal fluctuations. That makes it even more disgraceful that the Government manipulate funding formulas and move resources away from Lincolnshire to shore up the Labour party's votes in its urban heartlands.
	In addition, people may have been thinking of bringing inward investment and buying buildings to refurbish in the poorest wards in my constituency. I   notice in the Budget that the stamp duty exemption for investment in and refurbishment of commercial property in socio-economically deprived wards will be stopped. That will stop much-needed regeneration and therefore possible employment in those areas.
	I do not approve of the duplicitous way the Chancellor announced his Budget, and I will give the   House four examples of the significant positive points that he attempted to put over in his Budget. First, there was no mention of how raising the stamp duty threshold will be paid for by abolishing the stamp duty exemption for commercial investment in deprived wards. Secondly, there was no mention in the Chancellor's remarks that pensioners would get £200 off council tax for one year only. Thirdly, there was no mention that free bus travel would apply to off-peak tickets only. Fourthly, there was no mention that most of the money for the primary schools rebuilding programme has been announced already or that the relatively small additional sum would not be spent for another four years. It is because of that sort of duplicity that many politicians are held in such disdain.
	Finally, macro-economic stability is essential, but we must retain national competitiveness, and that will not be achieved by ever-increasing taxation and ever-growing public expenditure on public services, without fundamental and core reform.

Adrian Bailey: I welcome the Budget and want to explain how its   provisions will affect my constituents. While praising its provisions and the Government's work in my constituency, I want to suggest some areas where we could go further or change direction a little.
	My typical inner-city constituency is described as historically deprived. Four of its seven wards are in the 10 per cent. of areas with greatest urban deprivation. It has a low skills base, with almost 48 per cent. of my constituents having no qualifications, compared with the average of around 30 per cent. A lower than average number stay in education to the ages of 16 to 19, and a much lower than average number go on to higher education. It is typical of urban and historically deprived constituencies, but that is only one part of the picture, because it is being transformed in part by the   general improvement in our economic situation. Low interest rates have led to a boom in house prices and construction, and the increase in public sector investment in the past few years is beginning to show in schools, hospitals and the number of policemen, and general practitioners.
	The hon. Member for Westmorland and Lonsdale (Mr. Collins)—he is no longer in his place—said that the transformation in our economic situation started before the Government came to power. However, he did not say that, if that premise is accepted, public investment in   local authorities, particularly in education, did not improve. In my area it went down, despite claims that the economy expanded under the Tory Government. The fact that a number of then Cabinet Ministers are now leading the Tory party can give no confidence that in the unlikely event of the Tories being returned to power the situation would be any different. If they could not do it then, why should we believe that they could do it now?
	The child trust fund has enormous potential to combat long-term poverty and improve the take-up of long-term education. The Liberal Democrats' spokesman, the hon. Member for Harrogate and Knaresborough (Mr. Willis)—he is no longer in his place—said that there was a genuine policy difference between the Liberal Democrats and the Labour party, and I accept that. I believe that there is a strong and legitimate case for the child trust fund in education. First, it involves that proportion of the electorate who do not have bank accounts and in areas such as my constituency that is 20 per cent. of the electorate. The fund will provide a stake in the commercial world and with it an incentive for financial education, so that people understand and use that stake effectively. Without the child trust fund, that will not happen. Secondly, in the long term it will provide a fund that can be used for higher education. I have no doubt that if we are to reach our targets in higher education there must be a funding commitment, whatever party is in power.

Jenny Tonge: Can the hon. Gentleman assure the House that he believes that when a child reaches the age when they can have access to the trust fund they will use it properly and not just splurge it on a motor bike?

Adrian Bailey: I believe that most will use it properly. Obviously, a Government cannot second-guess the aspirations of every young person, but the hon. Lady's argument was used against giving money to mothers on the basis that they would go out and spend it on drink and cigarettes instead of on their children. Unless we provide that investment and give children a stake in the   future and an incentive to learn how to use that investment, they will never have aspirations.

Jenny Tonge: Surely the money could be used equally well in the early years to provide the same investment in the future and the same incentive to work and to do well at school.

Adrian Bailey: The hon. Lady is missing the point, because the Government are doing that as well. The level of investment in early-years education and schools is so great that it is questionable what the £1.5 billion that has been allocated for the child trust fund could provide. It is best used to provide young people with a stake in the future.
	There is a general debate about poverty and its impact on education. If the bottom 20 per cent. of people in deprived areas are not given a stake in the future, all the evidence suggests that they will be trapped in a circle of poverty. The child trust fund provides a gateway out of poverty.
	I recently visited the maternity unit at my local hospital, not because I am a politician who is predisposed to kissing babies—when I get close to them it usually has a horrifying effect on them—but because I wanted to talk to the young mothers about opening child trust fund accounts. Interestingly, while most had heard of the fund, none had opened an account. I flag that up as a serious issue, because the Inland Revenue is administering the fund and most people do not readily engage with a brown Inland Revenue envelope when itcomes through the door, particularly the bottom 20   per   cent. of people who are not used to dealing with financial matters. It was suggested to me at the hospital that it would be a good idea if people were available not to advise young mothers where to open an account but to outline the scheme to them when their babies are born, to ensure that they take it up. Young mothers readily take advice from health specialists, and we should look into that joined-up advice to ensure that those who most need child trust funds have the information they need to set them up.
	I have three Sure Start schemes in my constituency, and I am impressed by the work that they are doing. They engage young mothers and young children in a process that can affect them significantly in the long term.
	I am pleased with the provisions for helping lone parents back to work, because that is a route out of poverty for many young parents. I have a disproportionate number in the northern part of my constituency.
	I also welcome the emphasis on child care, which will enable young parents not only to find jobs but to find the necessary child care, which might otherwise be a hurdle.
	Above all, I welcome the proposals for investment in primary schools. Last Friday, I visited Great Bridge school, a private finance initiative school that has just opened in Great Bridge, one of the most deprived areas of my constituency. It replaced a building started in 1870. Despite the best efforts of the teachers and other staff, the physical state of the building was an obvious impediment to good education. I toured the new building on Friday and was inspired by the change in attitude, the spaciousness and the state-of-the-art technology, including whiteboards and computers, which have transformed the morale of the staff.
	Comments have been made about the impact of ICT on educational standards. It could be too early to reach a judgment on that particular school, but the technology there is providing marvellous motivation for both pupils and teachers. Teachers have told me that pupils are more ready to engage in computer learning than in some of the traditional forms. The quality of pupils' work, and its presentation, is also much improved, and that gives them a sense of self-esteem and self-worth. Our future lies in computers and whiteboard learning, in my opinion, and I am therefore very pleased with the level of investment in that technology in the Budget.
	It is now difficult to find a secondary school in my constituency that has not had major building work carried out in the past four or five years. GCSE results have improved by 50 per cent. since 1997. The results at   Alexandra high school have improved by 80 per cent.   and those of Willingsworth high school by   100   per cent. Wood Green high school had results 12   per cent. better than the national average, which is almost unheard of in my area. Although those are just the dry statistics, they represent a revolution in life chances for the young people involved—50 per cent. more of them leave school or move on with good educational qualifications and a bright future ahead of them. As a result of the education maintenance allowance, which was piloted in my borough, more pupils are staying on in education and more are going to university.
	I have a few comments about 14–19 education and the proposals outlined by my right hon. Friend the Secretary of State for Education and Skills recently. I   am happy to say that my constituency still has a significant level of manufacturing employment of about 30 per cent. However, manufacturers tell me that in spite of the general employment situation, they still face a skills shortage. They have real problems in getting young people to consider industry and manufacturing as a potential career. I hope that engaging industry in the formation of our vocational curriculum for the 14–19 age group will mean that that problem is adequately addressed.
	I come from a generation that thought that if one wanted to get on in life, one worked not in a factory, but in a white-collar job. We have to have a counter-revolution, because if we want this country to be successful and give industry the added value of our investment in education, we must ensure that some of those who benefit want to use it in the industrial and manufacturing context.

Kelvin Hopkins: I agree with my hon. Friend, but how do we overcome the problem that the really high salaries and the big money are earned in the City and in the financial sector, not in industry, which is much more vital for our economy?

Adrian Bailey: I must admit that the moving of people from my constituency to the City has not been a huge problem in the past. I would be happy if my constituents had the skills base to work in local industry where there is a skills deficit. However, I accept the broader point that my hon. Friend makes, although we should not assume that everybody is motivated purely by earning big money, in the City or elsewhere. Many people want to live in the west midlands and they want to contribute to industry, but salary levels have to be adequate and appropriate for the level of educational qualifications that employees possess. Of course, some 30 years ago, people went straight from school at a young age into industry because salary levels were relatively good.
	I emphasise the need to engage industry fully in the formation of the vocational curriculum, and we should consider pioneering ways in which industry and education can link up. If we are to enthuse people about going into science and industry, we need to start at primary, not secondary school level.
	Finally, I wish to make a few comments about higher education and pick up the themes outlined by my hon. Friend the Member for Norwich, North (Dr. Gibson). I   recently joined the Royal Society pairing scheme to try to get some insight into what was needed by the world of science. As somebody who forsook the study of science at the age of 14, it was a revelation to me to partner Dr. Laura O'Neill, a stem cell research scientist at Birmingham university. I was amazed by the work being done. The people I met were very appreciative of the investment put into higher education, which has provided modern, state-of-the-art facilities at that university. Significantly, the number of foreign scientists attracted to work there—by the facilities and the legal and ethical framework in this country—included some American scientists.
	I am worried about career prospects for research scientists. I was horrified to find that highly qualified lab technicians were earning £12,000 a year, with no real career prospects. If they could not get a fellowship, they could not be sure of any real career in science research. I welcome the money that the Government have outlined in the Budget for science research, but we need to address the need for a proper career structure that adequately recompenses those committed to research in science.
	I was pleased to hear the dean of Birmingham university outline a number of initiatives to market the breakthroughs made in biotechnology through small companies. I welcome the Government's financial commitment to developing that and the elevation of Birmingham as a science city. I hope that Ministers will look on the work done at Birmingham university favourably for further funds, because it already has a track record of exploiting biotechnology advances commercially. With more incentives, I am sure that it will continue to do so.
	The Budget will move Britain in the right direction. It is good for my constituency, and therefore good for the country. I say that not out of any local partisanship but because the social profile of my constituency is such that unless the Budget addressed educational qualifications, skills and poverty, we would not be able to meet the commercial challenges that we will face in the future. I   welcome the Budget and look forward to Ministers developing the policies that have already brought great benefits to my constituency. In the long term, those policies will help my constituency to play a vital part in transforming this country's economy.

John Wilkinson: I   am sorry that the Secretary of State for Education and Skills has gone. I was looking forward to commiserating with her about that nasty experience at the head teachers' conference when she seemed to have got the bird. I was wondering how that could have happened to such a nice person. All those of us who serve on European Standing Committee B—I see in his place the hon. Member for Luton, North (Mr. Hopkins), who is a regular attender like myself—always looked forward to the right hon. Lady's presence while we discussed the latest daft directive from the European Union or the   latest crazy regulation that would further damage British employment and business and further constrain the British economy. She always smiled her way through such occasions, but she did not cause much mirth with her rather petulant and uncharacteristic outburst at the beginning of her speech to the House today, when she   went into synthetic-phonics new Labour speak, fabricating facts about our intentions based on ridiculous ideas of how we would use the money saved from the cut in waste and bureaucracy which the Conservative party is determined to bring about in government. I am sure that she will grow into her job, but she will have to change her manner of addressing the House.
	I remember on first entering the House being struck by how alike Labour Members were to their caricatures. As I leave this place, I detect that the same phenomenon is apparent. I was struck then, as I am now, that hon. Members quite honestly echo their mimics and impersonators on television—and none more so than the son of the manse, the Chancellor of the Exchequer. He is great on the theatrics of his performances. The volumes of Hansard have stacked up, as the regulations and burdens on industry, commerce and the individual pile up under his stewardship. They represent the voluminous and needless complexity of the British tax system. I always regard excessive complexity in the British tax system as a reflection not of the imagination or strategic thoughts of Her Majesty's Treasury, but of the tiny minds that must, unfortunately, still exist in some recesses of that refurbished building and of the susceptibility to pressure groups and every societal constituency to which the Labour party is subjected and is amenable in the run-up to a general election.
	The Chancellor prides himself on creating stability. As far as the management of the British economy is concerned, he has produced stasis. We used to look forward to Budgets; they were exciting events—an annual occasion at which people put on funny hats and listened to imaginative proposals—but this one was a supremely boring occasion. People who had hoped for an optimistic vision in which British society would be galvanised so that it could realise its full potential went away disappointed.
	Perhaps I have a somewhat simple view of the role of government; I do think that it exists to realise the full potential of each and every person in this country. That is why I was struck by two excellent speeches, which we have enjoyed. One was from the hon. Member for West Bromwich, West (Mr. Bailey), who spoke from his personal experience. He related life as he saw it, as he had experienced it, on behalf of his constituents. So, too, did my hon. Friend the Member for Boston and Skegness (Mr. Simmonds), who analysed with great clarity and precision the deficiencies of the Chancellor's Budget, but similarly did so in the context of eastern Lincolnshire, which I know well from my days in the Royal Air Force.
	The Labour Government like nothing so much as to control each and every person's life. That is why I see no prospect, certainly not on the fiscal projections and given the black hole that undoubtedly exists in the Government's finances, owing to the very nature of socialism. It is socialism; the Government like to control almost as much as Ulricht's or Honecker's East Germany. They do it in a nicer way, but they like to spend more and more of the people's money as they think best. In the process, they create a mendicant society in which people have to ask for their entitlements through myriad and complex tax credits. It should not be so.
	Mercifully, I never will have, or ever could I have had, the opportunities that Ministers on the Treasury Bench have enjoyed. I hope that they realise in the exercise of their responsibilities the magnitude of the chance that they are privileged to have been given on behalf of their constituents. If they really want the United Kingdom to be richer and more prosperous, they have to tackle the burden of tax and do it resolutely and imaginatively.
	We must first, as my hon. Friend the Member for Boston and Skegness emphasised, do everything that we   can to stimulate savings and investment. To that purpose, I would suggest, as I have no responsibility whatever, a lower rate of income tax for savings income over that for earned income. That is a very simple and   perfectly straightforward measure, which could be introduced gradually. Its great merit is that it would recognise the fact that the income that people derive from savings is income from money that they have put away, which has already been taxed.
	Secondly, we ought to move, as in many countries in eastern Europe, to a single rate of income tax and a lower one, with higher personal allowances at the bottom, especially for the elderly. How wrong it is that   we have this "rob Peter to pay Paul" system, whereby there is a one-for-one withdrawal of the age allowance over a certain threshold. That is deliberately impoverishing people in old age and making it harder for them to enjoy the benefit of their savings.
	Thirdly, we ought to abolish inheritance and capital gains taxes entirely and create a genuinely enterprising economy, so that capital formulation is rewarded. Fourthly, because we ought to make it a virtue for people to provide for and have responsibility for their families, we ought to introduce tax relief for private school fees and for private medical insurance. I say that because thereby people would be not only providing for their own in the way that they think best, but saving the Exchequer by so doing.
	Fifthly, we ought to reintroduce mortgage interest tax relief and encourage home ownership, starting of course at the lower tax rate band. Sixthly, we should abolish stamp duty on share transactions, to make the City of London even more vibrant than it is today. Seventhly, we should reintroduce dividend interest tax relief for pension funds, and do it gladly and unashamedly, because it was a disgrace that it was ever taken away.
	Then, we should look at raising even further the bottom threshold for stamp duty on house purchase. The threshold of £120,000 that the Chancellor has introduced would hardly buy a garden shed in my constituency. At the same time, we need to diminish stamp duty on higher bands so as to encourage movement up the housing scale and the mobility of the labour force. Next, we should introduce over time a funded, state-approved pension scheme, as in Chile and Singapore, so that we can get investment in industry and   commerce and a more dynamic economy.
	Last but not least, in the context of the European Union constitution, we should renegotiate our relationship with the EU, not only to eliminate the British net contribution, but to ensure that we do not accept the EU's right to manage or back-seat-drive our economy. I am in favour of European tax competition, which is thoroughly healthy. Under a radical Conservative Government, we could win it for the benefit our people, to ensure their enrichment, prosperity and long-term fulfilment.

Jim Cunningham: May I   begin by querying something that the hon. Member for Westmorland and Lonsdale (Mr. Collins) said? I   might have misunderstood him—if so, he can correct me—but he spoke about withdrawing funding from education authorities. That is a dubious proposal, because under previous Conservative Administrations local government, and education authorities in particular, were always under siege. The argument was that there were too many people at the centre, and local management of schools was introduced.
	It has been suggested that Britain's economic recovery started before 1997. The hon. Member for Westmorland and Lonsdale said that it started under the Conservative Government, but I remind him of the disaster of the exchange rate mechanism. I am sure that   he will remember negative equity and, before the disaster of the ERM, the fact that the manufacturing industry in the midlands, including the motor car industry, was losing thousands of jobs every day and every week. The Standard Motor company in Coventry is no longer in existence, so the hon. Gentleman's suggestion that the grass was greener under Conservative Governments does not stand up.
	We have had many debates about rebates for council tax payers, but who made a mess of local government funding in the first place? In the 1970s, the famous Layfield report strongly advised Governments not to tinker with local authority finances. The Conservative Government of the early 1980s, however, introduced the poll tax, and we all remember the consequences. At the   same time, they withdrew money from local government. Local authorities used to receive a HIP—housing investment programme—allocation for housing, but the Tories started to withdraw that. Various grants helped to keep rates down, but they were withdrawn on a large scale. In fact, capital programmes were capped. Those are the days that the Tories are harking back to, so they really cannot crow about their record in government. As has been said, they have an appalling record on the economy and on local government.
	Whether or not the Opposition cut £35 billion of public expenditure, when they start talking about cutting waste and jobs we can bet our bottom dollar that there will be cuts in public services. Whatever the academic argument about cutting £35 billion, that is where the cuts will fall. To compound the felony, the Opposition have also talked about tax cuts.
	To strike a positive note, I shall turn to the Budget. Inflation has been about 3 per cent. for eight years, which allows businesses and families to plan ahead. Families can acquire mortgages or take a holiday—whatever they want to do with their money, they know that the economy has been steady for the past eight years with inflation at 3 per cent. Businesses can look two, three or four years ahead and know how much they will   spend on investment. From that perspective, the Government cannot be faulted. Over the past eight years, mortgage rates have averaged 6.1 per cent. Under the previous Government they reached 12 per cent. On one occasion, in fact, they reached 18 per cent. There is therefore a contrast between the way in which we run the economy and they way in which the Opposition did so.
	Every year, a member of the Opposition finds a black hole in the Chancellor's Budget and suggests that there is a crisis around the corner. However, since 1997, 4,000 new businesses have been created. When the Opposition were in power, about 2,000 businesses went out of business every year. I welcome the winter fuel allowance, which will remain at £200 for the over-65s and at £300 for the over-80s. The Opposition contend that the Chancellor did not say that the council tax rebate was only available for one year. In fact, he did—he said that it was available for one year pending a review of the council tax system. Anyone who thinks about changing the council tax system should be extremely careful, because history suggests that the House of Commons and Governments are not very good at doing so. We should therefore learn the lessons of the early '80s.
	While we have had debates about occupational pensions, we have not discussed problems with civil service, teachers or local government pensions. If a political party wants to make the headlines it says that there are too many civil servants and that they do not do anything. That has been said again tonight. However, since the Government came to power we have created a number of public service jobs and recruited many badly needed doctors and nurses. That part of the equation is never mentioned by Opposition Members when they try to justify their position. I am concerned about civil service, teachers and local government pensions and about job cuts. In the past few months, the Opposition have mentioned some extraordinary figures for job cuts in the civil service, but they are also going to make cuts in public services. How many doctors and nurses are they prepared to make redundant?
	An important issue for Coventry is the future of Peugeot, and recently we have had Adjournment debates on the subject. Over the past 18 months we have found it difficult to get answers out of the company. A few days ago, an announcement was made that 850 jobs would go, despite the fact that the Government had secured a grant of £14.4 million to assist the company with new developments and projects at the Coventry plant. However, the company says that it does not want   that money. At some point, we must introduce   meaningful legislation—the Government have announced their intention to do so—so that the consultation and information directive comes into effect. It is strange that Peugeot employees in France know something before the labour force in Coventry and Britain. We should have learned lessons from the collapse of Rover. BMW told its employees what was going to happen to them, but it also told them what was   going to happen to the Rover labour force. Action   was not taken, however, to enforce the relevant directive. The Government must take a radical look at that problem.

Kelvin Hopkins: I agree very strongly with my hon. Friend. Does he agree that if we had the protection that European workers enjoy at their plants, the Vauxhall plant at Luton might have stayed open, given that it was the most efficient General Motors plant in Europe?

Jim Cunningham: I do not disagree with my hon. Friend. When I served on the Trade and Industry Committee, we used to visit car plants and talk to the management and shop stewards. We must consult our labour force because we cannot continue as we have been.
	I welcome the additional money that has been put into the health service, where it is badly needed. Still more will be needed in future as science develops and new medical techniques become available. The money will not all be spent on bureaucracy. We are accused of throwing money at the health service and getting nothing from it, but that is not the case. If the Government are putting money into the health service, they should monitor it to make sure they are getting something out of it, and they are doing so. We certainly are getting something back—a new hospital and more doctors and nurses in Coventry. People tend to forget that it takes about seven years to train a doctor, and it takes some time to train nurses these days as their training becomes more complex.
	I welcome the extra money for education. I have always been concerned about further education. Vocational education could play a big part in getting young people in the inner cities interested in doing something with their lives by acquiring a trade. I know a number of young people for whom that has been a launching pad to university. We should concentrate on   further education to the same extent as we do on university education.
	When we speak about university tuition fees, we should remember that the previous Administration copped out when they set up the Dearing inquiry. I   remember meeting on a train a vice-chancellor who had met the then Secretary of State. I asked whether the universities would get any more money, and the vice-chancellor said, "No. The Government have set up an inquiry by Dearing." We all know what happened—it was intended to get them through the 1997 election. People tend to forget what the Conservatives are capable of.
	The Budget contains further measures to help jobs and businesses. Rates of corporation tax and capital gains tax have been frozen, which has not been mentioned in the debate. The freezing of insurance premium tax, the climate change levy, the aggregates levy and the tax on company cars are all important. I   have raised issues such as civil service and local government pensions, but there are many positive measures in the Budget. Someone commented earlier that the Budget was boring. I would prefer a quiet Budget; exciting Budgets are often the result of crisis.
	There is one issue that I should like my hon. Friend the Economic Secretary to look into. We have a problem in Coventry, which I am sure will spread to local government in the rest of the country—the funding of single status. That may lead to industrial action in Coventry this Wednesday. If the Government have made money available to fund changes in the health service, they could certainly assist local authorities with single status, as it was Government legislation which introduced that.
	I welcome the Budget, particularly the positive measures it contains for businesses, especially small businesses. I commend the Budget to the House.

George Young: It is a pleasure to follow the hon. Member for Coventry, South (Mr. Cunningham), who spoke movingly about the problems that confront his city following the decision by Peugeot on the Ryton plant. We hope the   dialogue to which he referred has a productive outcome.
	The hon. Gentleman was slightly less than fair on the actions of the previous Administration, who worked closely with Coventry city council on inner-city regeneration, housing renewal and other schemes that helped the ethnic minorities in his city, so I hope he is prepared to put a little on the other side of the scale, alongside the rather disparaging remarks he made about the Administration.

Jim Cunningham: I give the right hon. Gentleman credit. I remember that he and I had discussions about the Muslim resource centre in Coventry and the Indian community centre. Indeed, he was the Minister at the time.

George Young: I am grateful. That is generous of the hon. Gentleman.
	I shall make a brief contribution to the Budget debate. We have had the weekend to reflect on the Budget. We   have had time to talk to our constituents. I was in   Liverpool, Wrexham and Andover over the weekend, and in all three places I found a rather muted response to the Budget. I am not sure that it has had huge political impact. It certainly has not kick-started the Government's flagging re-election campaign back into life, as many Labour Members may have hoped.
	There are a number of reasons for that. The Budget lacked what I would call bullet points. In my constituency, as in many in the south-east, the stamp duty changes will have little impact. Petrol duty has been frozen, but only for the time being. The council tax help is welcome, but it is only for one year and it is less than that promised by my party. Other parts of the Budget were too complicated. I shall return to that.
	In the old days there was one highly visible budgetary thermometer—the standard rate of income tax. That told us something about the Budget and about the   Government. Everybody knew how to read that thermometer. By and large, under the Tories it went down and under the Labour party it went up. Nowadays there is no single thermometer by which we can judge the Budget. Instead, there are hundreds of little sensors all over the body politic, all giving out slightly different signals. That makes the Budget much more difficult to interpret.
	I do not say that as a criticism of the budgetary measures, but I do think that the move away from changing the rate, doing something significant about the allowances and focusing instead on micro-measures makes it more difficult for the public to read a new Labour Budget and come to a judgment about it.

Kelvin Hopkins: The right hon. Gentleman is correct to say that the Budget is more complex these days, but perhaps it still represents a statement about the fiscal stance. The present Budget reflects a slight tightening of the fiscal stance.

George Young: Indeed, and I shall come to that in a moment. It was the right thing to do, in view of the changing fortunes of the Government finances.
	Over the weekend I detected some fatigue following the exchange of fire last week about public expenditure totals and who will spend how much. My heart sank when the Secretary of State for Education and Skills introduced the debate this afternoon with a sentence about £35 billion, which, I suspect, every special adviser now writes into every Secretary of State's speech. My view, which I fear will not be shared, is that the Easter recess would be a useful time to have a ceasefire and spare the public a little of the warfare that is raging. There is real election fatigue out there. I remember reading that in the first world war, on Christmas day the   soldiers stopped shooting and played football in no-man's land. That might be a useful way of spending our Easter, but I suspect that all three parties have major political onslaughts planned for the Easter recess.

Peter Bottomley: Would it not be a good idea to return to what used to happen, when Ministers told special advisers what to do, rather than special advisers telling Ministers what to do?

George Young: Yes. I hope that no Secretary of State who is to speak in the rest of the debate will repeat the £35 billion figure. The public are fed up. The more Ministers go on about it, the more damage they do themselves.

Ivan Lewis: rose—

George Young: I hope that the Minister is not about to defend the constant propaganda that we have been hearing over the past week, which is wholly counter-productive.

Ivan Lewis: Perhaps I can help the right hon. Gentleman with three bullet points, and ask him to comment: low interest rates, low inflation and low unemployment. That is the barometer by which a Budget is usually judged. On spending, is it his party's position to match the Government's spending on schools, or on education? Massive sums of money are spent beyond the school system.

George Young: I am not sure whether the Minister was in the Chamber when my hon. Friend the Member for Westmorland and Lonsdale (Mr. Collins) introduced the debate. He made our policy absolutely clear and it is in Hansard. I welcome low inflation and low unemployment. As a Treasury Minister some 10 years ago, I am prepared to take some of the credit for the financial position that the Government inherited in 1997.
	As I listened to the Chancellor of the Exchequer last Wednesday describe how well things are going—in many cases they are going well, and I welcome that—I   had to ask myself why, if things are going so well, the Chancellor has to borrow so much more than he thought, and has to borrow quite so much at this point in the economic cycle. That question has not been satisfactorily answered. Perhaps the Minister who winds up the debate will answer it. I respectfully agree with outside commentators who say that if Ministers, notwithstanding all the assertions that we have heard from them, want to sustain their planned level of spending, they will have to raise taxes in order to do so.
	Incidentally, the actual level of Government borrowing is far higher than that stated by the Government. Who, for example, would lend to Network Rail after the debacle of Railtrack if the Department for Transport did not stand behind those loans? Now that the Strategic Rail Authority is disappearing, the Department for Transport stands behind those loans, but miraculously that liability does not show up on the Government's balance sheet. Indeed, if one followed the National Audit Office's interpretation of liability, the Government's golden rule would have been shattered several months ago.
	May I offer, with respect, a word of caution to the Government regarding their boasts about public services, particularly the NHS? Many hospital trusts and primary care trusts in the south-east, especially in Hampshire, are running large deficits and are having to introduce financial recovery plans in order to balance the books. The Mid Hampshire NHS Primary Care Trust is looking at spending reductions of some £14 million. It has to save £9.5 million to deal with a   recurrent deficit and £4.5 million to deal with non-recurrent savings. It is looking at fewer staff, has not ruled out redundancies and is planning to reduce beds. That local debate, which I suspect is being reproduced elsewhere in the south-east, provides a rather discordant background to the harmonious noises that we have been hearing from Ministers about record investment in the health service. Once one nets off the impact of higher drug prices, reduced working hours for doctors and the high cost of recruiting temporary staff, the extra cash gets eaten into. Some of it is ring-fenced. Services that are not ring-fenced are the ones that are exposed to reductions in investment. NHS dentists, in Hampshire as in other parts of the country, are increasingly difficult to find.

Andrew Love: Can the right hon. Gentleman tell us what contribution would be made by the patient's passport that his party wishes to introduce, which would probably take in excess of £1 billion out of the national health service?

George Young: It would have been welcomed by poor pensioners in my constituency who were unable to wait for the NHS to treat them and dug into their modest savings to pay for private treatment. If I may say so, Labour Members are wrong to assert that the only people who would benefit from that policy are the very well-off; that is simply not the case.
	The Chancellor decided against raising tax allowances above inflation and is instead putting the money into tax credits. The House should pause and consider the practical and philosophical issues behind his decision, which I do not find easy to endorse. In the briefing that we all have today, Age Concern tells us that nearly one third of pensioners eligible for pensioner credit fail to claim it. This is not a new benefit, and there has been time for the take-up campaigns to kick in, but there is still a very low take-up, coupled with the horrendous complexity of filling in the forms and then operating the system. In today's post, I received a typical letter from the Inland Revenue. I quote:
	"I am sorry to hear of the difficulties that Mrs W has experienced with her tax credit claim. Having looked into her claim, I can confirm that we have issued Additional Tax Credit Payments to the sum of £269.92 on Feb 22nd in order to prevent any further hardship."
	We all have letters like that from the Inland Revenue about tax credit cases in our constituency. Of course, the claimant will have to pay back that money in the years ahead. The regime that the Chancellor keeps on developing has become so complicated and top-heavy that it is time to stand back and have a look at it.
	When the Inland Revenue makes a mistake, it will ask the person to pay it back if they have not spotted it. How many of us who fill in our own returns will check the Inland Revenue's calculations line for line? Most of us will assume that it is a professional department and that having given it the correct information, it will provide the correct assessment. But what about the single parent who has filled in the form correctly, gets incorrectly assessed and is overpaid, and is then told that she should have spotted the overpayment and that the money must be repaid? Then the payments stop, she cannot pay the childminder and has to give up the job, and is back where she started. The House should have a serious debate about the alternative of raising the allowances, reducing the interface and streamlining and simplifying the system rather than piling extra resources into an increasingly complex scheme.
	One or two Members mentioned council tax. Here we have another one-off payment to council tax payers alongside the one-off increase in grant of £1 billion to local authorities that was announced last December. What will happen next year, when the council tax payer will not get the £200 and when the £1 billion to local authorities is not repeated? It strikes me that the approach to local government finance is hardly joined up or coherent—it seems to be a rather ramshackle and unstable structure.
	I want to say a word about the emergency action that the Chancellor took in the Budget. Of course, from time to time the Chancellor has to act quickly to stop an abuse, and I have no quarrel with that. However, the withdrawal, without notice, of stamp duty for commercial property in disadvantaged areas struck me as odd. The Chancellor introduced that with a great fanfare in 2003, and such inner-city initiatives take time to bed down and get taken up. The wards that the scheme applied to were chosen by the Chancellor, and there may be developers who were induced to invest and develop and now find themselves some 4 per cent. out of pocket. I hope that that does not damage the credibility of the Government's initiatives, which depend on trust and genuine partnerships with the private sector.
	I want to end with three brief points on education. First, on school meals, I cannot be the only Member who has been e-mailed and written to over the weekend following the Channel 4 programmes with Jamie Oliver. There has been a very good response, and it may be that those programmes have the same impact on school meals as "Cathy Come Home" had on housing policy some 20 or 30 years ago. I was a little disappointed with the Secretary of State's response and delighted to hear my hon. Friend the Member for Westmorland and Lonsdale say that my party's response to the challenge of a policy on school meals will come out shortly and will be more imaginative than that of the Government.
	Secondly, the Chancellor made a big play about deregulation in his Budget, but we heard nothing from   the Education Secretary about deregulation in education. There is a real appetite on the part of teachers for less regulation and a more streamlined approach so that they can use their skills on the interface with children.
	My third point on education has not been mentioned—it concerns work force remodelling. That is an initiative due to be introduced this autumn whereby 10 per cent. of teaching time is made available to teachers for preparation, so that for one half-day per week they will no longer have to take classes. I have no difficulty with that policy, but there is real concern that insufficient resources have been given to schools to enable them to pay other people to take over the classes that the teachers will no longer operate. I read in the press a few days ago that although head teachers had initially supported the policy, they were having second thoughts because it was under-resourced. I hope that the Government will take that seriously. It is a small cloud on the horizon, but if they do not get it right, there will be serious disruption in schools later this year.
	The Budget is unsustainable economically and has been unsuccessful politically. I therefore look forward to a Finance Bill introduced by my right hon. and hon. Friends in a few weeks' time which will do both tricks.

Iain Wright: In my brief contribution, I want to focus on some broad macro-economic factors that the Chancellor mentioned in his Budget statement, and then to focus on matters, particularly the need for skills, that directly affect my constituents.
	The Chancellor was right to outline the global competition that Britain faces. Members on both sides of the House have mentioned China and India as having the potential to become major economic superpowers in the next few decades. Economic growth rates, year on year, of some 10 per cent. in India and China and their almost insatiable demand for raw materials will naturally have profound consequences for the UK economy. I am worried that that sustained burst of demand will increase the unit cost of raw materials throughout the globe and that that, in turn, will damage the robustness of the UK economy's ability to fend off inflation in the short to medium term.
	I am equally worried that the low wages offered in those countries will mean that British firms will not be able to compete. I have been told that workers in many parts of the Chinese economy are paid the equivalent of 75p a day. We cannot compete with that rate, and nor should we want to. The British economy should be concentrating on high-skilled, high-value, high-technology companies, not sweat-shop labour. I shall return to that point later.
	I am confident that the structural changes to the UK economy made in recent years will enable us to maintain this sustained period of economic stability. Several factors have produced that stability. First and foremost was the decision taken in the first few days of the Labour Administration in 1997 to make the Bank of England independent. I do not wish to make petty party political points, much as I am tempted to. For example, I was impressed that the right hon. and learned Member for   Rushcliffe (Mr. Clarke), who is not in the Chamber, introduced inflation targets when he was Chancellor, although the Conservative party now appears to despise targets as a means of improving performance.
	I agreed with my hon. Friend the Member for Coventry, South (Mr. Cunningham) when he said that he approved of boring Budgets. I think that boring Budgets mean economic stability, so I would rather have them than exciting Budgets that reflect boom and bust and the stop-go economy of the 1980s and 1990s. That was my experience as I was growing up in my constituency. The Conservative Government of the 1980s decimated economic activity in Hartlepool and did that again in the early 1990s, so I would rather not have lessons in economic management and competence from the Conservative party. The fact remains that only a Labour Administration were bold enough to give the Bank of England independence, which was an important building block in helping to produce a stable and prudent economy.
	A second key factor that is often grossly overlooked is the decision taken in 1997 to repay a substantial amount of the national debt. The figures provided by the Chancellor in his "Financial Statement and Budget Report" last week were impressive. National debt has reduced from 44 per cent. of national income in 1997 to 34 per cent. today. Apparently we have repaid more debt in one year than the combined total of that repaid during the previous 50 years. Debt interest repayments now represent the lowest share of our national income than at any time since 1915.
	The fact that our debt repayments have been substantially lowered has meant that the Government have had the flexibility and added receipts to invest in schools and hospitals. Rather than wasting revenue on loan repayments and unemployment benefits, which is what happened in the 1980s, the Government have had the foresight and ability to spend money on our children's education, our health and law and order. Surely everyone can welcome that.
	These factors, among others, have meant that the Government have presided over historically astonishing economic stability and growth. The International Monetary Fund report on the UK economy this month has been cited in some quarters as evidence that all the good work done in recent years will slide into an abyss. After reading the report, however, I do not share that   interpretation. I see a British economy that is remarkably robust enough to withstand the shocks and uncertainties that the wider global economy will almost certainly throw at it. As the report states:
	"The fiscal and monetary policy frameworks remain at the forefront of international best practice  . . . The economy remains enviably"—
	I really like the word "enviably"—
	"well positioned to sustain steady and strong economic growth over the medium term".
	That does not appear to paint a picture of a Chancellor who has squandered prudence. Instead it shows that he has put in place and consolidated long-term prosperity and stability as the centrepiece of his economic policy.
	I have never delivered a speech in the Budget debate before, so I did a bit of research by looking at previous debates, especially those held in 1997 and 2001. When I   read the speeches made by Conservative Members, I was struck by their almost universal mantra that we were about to embark on a road of economic doom and gloom and imminent recession. Since 1997, the Chancellor has consistently been able to make a mockery of such claims. I am sure that we will see with hindsight that the current claims made by Opposition Members about economic mismanagement will prove to be equally hollow.
	I sincerely believe that the future of the British economy is with state-of-the-art technological companies and a highly skilled work force producing high-value products and services, such as disease-eliminating drugs arising from biotechnological advances and environmentally friendly energy sources that can be exported to the rest of the world. That is why the emphasis on research and development and science in the Budget is crucial to the long-term health of the British economy. Equally, the removal of regulation for our companies is a welcome step, and the principle that our well-run firms will be subject to less audit and inspection will go a considerable way towards ensuring that success and compliance with regulations are rewarded with freedom and flexibility.
	The fact that added emphasis is being given to enterprise and entrepreneurialism is also welcome. We need to have at the forefront of Government thinking the ways and means of educating and nurturing a highly skilled work force with the capacity to produce world-beating ideas.
	By chance, on the day on which the Chancellor delivered his Budget statement, I met David Waddington, the incoming principal of Hartlepool college of further education. The college has been absolutely central in my constituency during recent years in raising aspirations and increasing the number of people in Hartlepool with qualifications. However, David expressed concern over a long-term trend of skilled and educated people leaving the town after receiving a qualification to take advantage of the vibrant economy in London and the south-east. The Hartlepool economy has come a long way in the past 10 years, but I fear that a brain drain will result in fewer opportunities for prosperity in the town, which in turn will create the risk of higher dependency on benefits. Hartlepool people do not want handouts; they want the prospect of additional prosperity and stability.
	There is evidence that that is happening, but I want it to go further and happen faster. The number of business start-ups in the town has recently increased massively after being decimated by the recession in the early 1990s, but we need many more businesses in my town to provide opportunities for wealth and employment creation. I urge the Chancellor to intervene, at least in the short term, to ensure that skills and qualifications obtained by Hartlepool people are rewarded with well-paid employment prospects and job opportunities in Hartlepool. We should continue to help businesses by putting in place the infrastructure necessary to compete with the rest of the country and the world, such as a direct, fast rail link to London and incentives for businesses to relocate to, or be established in, the town.
	Other measures in the Budget will greatly help my constituents. The doubling of the value at which stamp duty is paid should have a positive effect on the Hartlepool housing market, in which most properties fall within the £60,000 to £120,000 price range. That will enable more people in the town to own their own homes and move further up the property ladder. I am slightly concerned that the move will accelerate still further housing market failure in the centre of the town relating to terraced properties, but in general, and on balance, I   think that the proposal will stimulate demand.
	It almost goes without saying that the extension of tax credits and help for pensioners will greatly assist hard-working families and older people in Hartlepool. The fact that the tax credits mean that a family with two children starts to pay income tax only on income above £21,200 will have a hugely positive effect on the majority—the absolute majority—of my constituents, because average earnings in Hartlepool remain below the national average.
	I found a hugely important statistical table in this week's edition of The Economist showing the effects of the Labour Government's Budgets between 1997 and 2004, especially on the income of the richest and poorest in our society. It showed that the net income of the poorest 20 per cent. had increased by some 8 per cent. over that period, while the richest 10 per cent. had experienced a relative fall in their net income of about   5 per cent. I believe passionately that such a redistributionist economic policy, which flattens economic and financial inequalities in our society while encouraging and rewarding enterprise, is exactly what a Labour Administration should be pursuing.

David Taylor: My hon. Friend is right to point to the progress that has been made. However, is it not also the case that, in terms of wealth and income, the top 20 per cent. of the British population pay less in tax than the bottom 20 per cent.? There is still a good way to go and many more objectives for a third-term Labour Chancellor to achieve.

Iain Wright: I welcome my hon. Friend's intervention and agree that more remains to be done. However, a lot has been done since 1997.
	The Budget has continued the themes of previous Labour Budgets of providing an extra share of the national wealth to the vulnerable and the hard working while consolidating economic stability to enable the wealth of our country to increase.
	In the Budget, the Chancellor has not played games with the long-term condition of the country's economy. The measures that he proposed last week strengthen Britain's competitiveness while redistributing our additional wealth. I commend the Chancellor for his Budget.

Desmond Swayne: It is   a great pleasure to follow the hon. Member for Hartlepool (Iain Wright). I thoroughly enjoyed my brief   sojourn in his constituency in the autumn and I   especially remember the highlight, which was attending a meeting about the local hospital. I am sure that the hon. Gentleman will acknowledge that he got a much better hearing in the Chamber this evening than at that meeting, thus giving the lie to the notion that we all behave badly in Parliament and it is all so much better out in the country. It was the other way round.
	It is an enormous pleasure to be called to speak in the Budget debate, especially on a day when the theme is education. I taught pure economics—economic theory—for the best part of seven years and my results were quite good. Indeed, I boasted to colleagues that, were I given a reasonably intelligent Labrador, I could get it a pass at A-level, if it were prepared to put in some work.

Kelvin Hopkins: By coincidence, I also taught economics. When I was teaching, there were statistics that demonstrated that economists had IQs that were 15 per cent. lower than those of mathematicians.

Desmond Swayne: I find that hard to believe given that pure economics is only applied mathematics.

David Taylor: No, it is not.

Desmond Swayne: I beg to differ. It is basically applied mathematics and the notion of a differential between economists and mathematicians is therefore difficult to sustain.
	However, my incredulity at the Chancellor's economics is not difficult to sustain—they mystify me completely. I am all at sea with them. He was at great pains to point out that we were in the 50th consecutive quarter of sustained economic growth—the longest such period of economic growth. He is right. If we use that measurement, it is the longest period of economic growth since the reign of Queen Anne. However, one has to count 18 quarters under a Conservative Government.
	I am concerned, at a time of such sustained economic growth, about the amount of borrowing in which we indulge—it is a worrying phenomenon. If we go back to the Budget of 1992, the prediction for borrowing this year was some £17 billion, and £18 billion for next year. Yet this week, the Chancellor told us that, for this year,   the figure would be £32 billion, and £29 billion for next year. We are talking about a mind-boggling £150 billion to be borrowed in the next four years. Those figures no longer have any meaning for us; they are beyond our comprehension.
	Spending is rising at a faster rate than economic growth and the deficit keeps growing. There are places in the Palace of Westminster where one can have the benefit of Sky television and I am often Downstairs in the mornings when the television is on—

Peter Bottomley: In the gym.

Desmond Swayne: I shall not say precisely where; I shall speak to my hon. Friend privately afterwards. However, one is bombarded with advertisements for loans: "Consolidate all your debt into one easy monthly payment and have that long desired holiday." It is interesting that the Griffiths commission report, which draws attention to the £1 trillion of private debt that has been accumulated and the possible consequences for economic stability, was published today. It makes our Chancellor's intention to borrow appear parsimonious. Nevertheless, there is no prudence in the proposals for Government borrowing.
	Like the dream holiday that ordinary consumers are tempted to take, borrowing is sustainable and justifiable only if it will generate a greater source of revenue in future and if it is truly investment. People come to our surgeries having somehow found themselves in debt; for all sorts of purposes, they have taken on debt that they simply could not sustain. I wonder whether the Chancellor is so different in his calculations and his golden rule. Why did it take Sir Peter Gershon to identify £20 billion of Government expenditure that could be saved and much better deployed?
	Since the Chancellor came to office, the public sector has grown by some 583,000 jobs. Those people are not all doctors, nurses, teachers or policemen, and it therefore poses the question what precisely they all do and what they add to the value of public services. Productivity growth in the public services has been reducing, as shown by the reports of the Public Accounts Committee and the Audit Commission. Improvement in results has not maintained the same rate of growth as it did under the previous Conservative Government. Crime detection statistics have plummeted and performance has not been impressive. The rate of improvement has been declining.
	I want to end with an example, which, I appreciate, will prove controversial, as it did when I raised it in an intervention on the hon. Member for Harrogate and Knaresborough (Mr. Willis). The Chancellor said that he will increase expenditure on IT in schools by a further £1 billion in addition to the £2.5 billion that he has already put in. I draw hon. Members' attention to the report that the Royal Economic Society produced today. Its conclusions state:
	"Despite numerous claims by politicians and software vendors . . . the evidence so far suggests that computer use in schools does not seem to contribute substantially to students' learning of basic skills such as maths or reading."
	It goes on to suggest that the relationship is inverse: the more access one has to that sort of technology, the more those basic skills decline. I can suggest one or two reasons for that.
	I have been in classrooms where I have seen children sitting, looking bored, in front of computer screens, wondering what to do next. If one cannot read what is on the screen, the technology is of no benefit. If one cannot manage the mathematical concepts, the technology is of no assistance. Some of the technology in schools reminds me of the fashion for language laboratories in the mid-1970s when I was at school. I   wonder how many of those laboratories survive. It was the fad and fashion of the time. We are the generation that did not have technology in schools but have survived quite well. Often, the argument for the necessity for such technology is, "Oh they'll need it to get a job; they'll need it in the workplace." And of course it is now commonplace for people in the work place to have to develop computer skills.
	We are the generation who came through before even   the Sinclair calculator was invented. We used logarithms and slide rules, and the personal computer was a mystery to us. However, we fared pretty well. I   was once the manager in charge of risk-management systems for one of our leading banks, which was at the cutting edge of modern technology. When I took that job, I had not even seen a computer. The reality is that   things were tougher for us, because at that time, we had to address the machines in their own native language. We did not have the interface of the mouse, or the ability to click on an icon. We have been able to pick up these skills quite easily, however, because we were taught the basics of literacy and mathematics at school. That is the importance of school. In so far as technology can aid that process, it is welcome, but when it becomes a distraction from it, it reduces productivity, just like so much of the public expenditure from which we now benefit.

Peter Bottomley: I would not disagree with my hon. Friend's final point, but does he accept that what he was saying about technology was tosh? At first, people said that we should not take slide rules into exams, but then they became compulsory. That is no different from when the first electronic calculators came along when he was 10. They can be an aid to those who have also been well taught in the basics.

Desmond Swayne: I know that I am looking very well on it, but I think that I was 16 when the first electronic calculators came along. I certainly recall slide rules being compulsory in exams. There were two questions in our maths O-level that we had to do using a slide rule, and a couple that we had to do using logarithms. Of course I am not saying that technology has no place. I   am just saying that I am sceptical. I said at the beginning of my speech that I had taught A-level economics for about seven years. At that time, I could have had the advantage of an electronic blackboard, had I had the will to use it. However, the reality was that it was an extremely sophisticated and expensive piece of equipment that actually produced no advantage whatever over the blackboard and chalk, except that it was more expensive. Frankly, I felt that the money could have been better spent elsewhere.

David Taylor: In the light of what the hon. Gentleman said earlier, will he confirm that he taught economics at Battersea dogs home?

Desmond Swayne: The hon. Gentleman takes me back. However, in the light of his question, I shall not say where I did teach.
	Much of the Government's determination to spend money is misplaced. So much is being borrowed, and so much could be better spent. I am confident that our propensity to find savings rather greater than the further £12 billion identified in the Government's Gershon report is entirely realisable. Our determination for Government expenditure to grow by 2 per cent. less than the Government would have it grow is also an entirely laudable and achievable objective.

Kelvin Hopkins: It is always a pleasure to follow the hon. Member for New Forest, West (Mr. Swayne), and I was greatly entertained by the last part of his speech in particular. I must be older than him, because, before electronic calculators came in, I   used to use an electro-mechanical calculator, which was like a vast electric typewriter. The last time I saw one, it was in a glass case in the Science museum. I am clearly almost from the stone age.
	I would like to congratulate the Chancellor on a sensible Budget. I do not think that it will be remembered for very long, because Budgets are not. Harold Wilson memorably said that a week was a long time in politics, and I am afraid that Budgets, like everything else, are forgotten fairly quickly. What will not be forgotten, however, is the fact that we have had a strong economy for a remarkably long time and that,   under the Chancellor, it has been managed extraordinarily well for the past eight years. We hope that it will continue in that vein for a long time to come. I might wish to debate some of the Budget's detail with my right hon. Friend the Chancellor—I would like to include some more radical measures, for example—but his reputation will be unmatched by others who have gone before and, no doubt, by some who will follow.
	We have taken too much notice of the possibility of a deficit, and argued about what size a deficit might be. Any Opposition coming up to an election will naturally be alarmist about these things, but I do not believe that missing the objective of the golden rule by a few billion is a great tragedy in the history of economics. I would refer hon. Members to a fine book by J. K. Galbraith entitled "The World Economy since the Wars", which recorded that, in the second world war in particular, America borrowed like there was no tomorrow—it might have seemed as though there was no tomorrow—and finished up with the strongest economy that the world had ever known. Borrowing and having a deficit are not, of themselves, tragic. Indeed, with our gross borrowing at such an historically low level, there would not be a serious problem for the British economy even if the Chancellor broke his golden rule.
	If the Chancellor did break the golden rule, and if, after being re-elected, he chose to raise taxes on the better off, I personally would not object. I know that that is not in his mind, but I would not object at all to such a proposal. Indeed, it would be very sensible. In fact, I would go somewhat further in spending some of the largesse of the wealthy on providing better public services and better pensions for people who are less well off. However, that is my view and I recognise that it does not represent the Government's view. I am perhaps a bit more traditional in that regard. With views like these, it is unlikely that I shall ever be promoted to the Front Bench, but I like to say what I believe to be the truth.
	I should also like to congratulate the Bank of England on its management of monetary policy. I was sceptical about its independence, but it has been a success, not because of independence but because of the way in which it has managed monetary policy. I hope that I   shall not upset too many people by saying that the Bank of England has managed monetary policy rather better than the Treasury would have done, because it has been more expansionist. I would guess that, by and large, it has set interest rates at about 0.5 per cent. lower than the Treasury would have done. The economy has therefore grown more quickly and demand has been sustained, which is a very good thing.

David Taylor: I endorse my hon. Friend's praise of the Bank of England's success in delivering monetary policy objectives. Does he believe, as I do, that that stands in stark contrast to the stability and growth pact surrounding the euro, and points up yet again the extreme undesirability of entering that seriously flawed arrangement?

Kelvin Hopkins: As so often before, I agree entirely with my hon. Friend. In fact, he takes me to my next point, which is that, if the Bank of England had not managed monetary policy very well, the Government could take it back and manage it themselves. However, they would not be able to do that if we had made the mistake of joining the eurozone. I am glad to say that my right hon. Friend the Chancellor has steered us well clear of it for eight years, and I hope that he continues to do so.
	There is a danger of being a bit too cautious. We have had a symmetrical inflation target that was slightly higher than the asymmetrical inflation target on the continent of Europe, certainly in the first part of the   eight years of this Labour Government. That has meant that we have been able to have a slightly more relaxed monetary policy. However, I believe that there is more scope for relaxing monetary policy—and keeping an eye open for opportunities to do so in the future—so as to ensure that demand does not fall.
	Sustaining consumer demand in the economy is fundamental to keeping employment high. When employment is high, tax revenues are high, benefit payments are lower, and the economy works well. That is the kind of economy that we had from the end of the second world war until the mistakes of the 1970s were made. We are now moving back in that direction, and I   hope that my right hon. Friend the Chancellor will not press the Bank of England to be too cautious with monetary policy so as to cause the economy to deflate, or to make the terrible mistakes that have been made in the eurozone.
	I also want to say that the Tory comments about there being a black hole in Treasury accounts really are nonsense. Compared with the past—this point has been made by my noble Friends in the other place—our deficits and surpluses are negligible and of small account. Britain has a much stronger economy, with lower gross borrowing and gross debt than any other country in the developed world, and has been a tremendous economic success, perhaps in contrast with what went on in the 1980s.
	The important thing is to keep the economy buoyant, not to worry too much about 0.5 per cent. more inflation. Is that dangerous talk? I do not know, but 0.5 per cent. more inflation is far less important than maintaining high employment, high growth and high prosperity.
	It is another Tory myth that this country is highly taxed. That is just not true. The Organisation for Economic Co-operation and Development table shows that our tax burden, as it is called, is much lower than that in most of the most developed countries. The idea that low taxation is somehow essential for a successful economy is, again, complete nonsense. The two strongest economies, arguably, are Sweden and Norway, which have some of the highest taxation in the world. Indeed, Sweden is the highest taxed in the world, but it is competitive and prosperous with a strong welfare state. If I had to wish Britain to drive in any particular direction, it would be that of Sweden.
	Interestingly, at the last general election, Sweden's Conservative party chose to campaign on tax cuts and spending cuts. It was rejected by the electorate and that campaign helped the Social Democrats to get back into power. Indeed, the Swedish Conservative party has changed its policy: it is not campaigning for tax cuts or for spending cuts any more, because it knows that they are unpopular.
	So, Sweden is ahead of us. The difference between Swedish and British taxation is of the order of 15 per cent. of GDP, which is a staggering amount—more than £150 billion a year. I am not suggesting that we suddenly start to have Swedish levels of tax, but there is scope for a little more taxation—particularly for the rich, provided it is progressive—and for a little more spending on the things we think are important. Norway, compared with Britain, has an extra £90 billion of tax. The figures for Norway are quite a long way from those for Sweden, but it still has a strong economy.
	If one wants confirmation that the Norwegian economy is very strong, one should look at the Chancellor's booklet entitled "Long-term global economic challenges and opportunities for Europe", which was published with the Budget. Chart 2.9 on page 18 shows GDP per person employed against employment rates. The country furthest from the origin—in other words, the strongest economy on those measures—is Norway.
	Norway is not only outside the eurozone; it is not a member of the European Union. I am not suggesting that these things are necessarily related, but that is at least an interesting correlation and Norway is not tied into the deflation of the eurozone. The only point on which I agree with the hon. Member for Ruislip-Northwood (Mr. Wilkinson) is that we at least can choose our own economic policy in Britain—our Chancellor and the Bank of England are doing very well in that respect—and we do not have to submit to the mistaken policies of the European Central Bank and, indeed, the European Commission.
	The wisest decision of our Chancellor has been to keep us out of the eurozone, although he probably would not want to pursue that argument too strongly for fear of causing dissension among one or two colleagues. I do not mind saying that because I am a Back Bencher, and I know that one or two colleagues on the Back Benches take a similar view.
	The German economy, in contrast with that of Britain, is in serious trouble and has the highest unemployment since 1933, which is a significant date. The Germans are in a bind: they cannot devalue their currency because they are tied into the euro; they cannot reduce interest rates because they are set by the ECB; and they are being told constantly that they must tighten their fiscal policy as well, which is madness—it will drive them further into economic depression. We have all the advantages, being outside the eurozone, and let us not make the terrible mistakes that the Germans did, not just in joining the eurozone, but in joining the euro at a high parity for their currency. They then had to raise interest rates as well.
	We have a strong economy, and I congratulate the Chancellor on his management of it so far. I would love him to be a little more adventurous and progressive in his taxation policies, but that is an argument for another day.
	I want to say a few things about education, which is ostensibly the subject of today's debate, rather than macro-economics. I have a profound interest in education. I was in education, like many members of my family, and I am a vice-chair of governors of Luton sixth-form college. Since being elected to the House, I   have campaigned for the Government to recognise that there is a funding gap, which has not yet been closed, between sixth-form colleges and school sixth forms. Sixth-form colleges are not quite the same as further education colleges: they do not get external funding from business and they depend on public spending.
	It is not just unfair, but foolish, for us not to sustain sixth-form colleges. I believe that they are the geese that lay golden eggs in our education system. They have every possible advantage for sixth-form education, and I invite Members to come to Luton to see the sixth-form college. I am probably alone among Members in having two such colleges in my constituency, both of which got grade 1 in their inspection and have been given beacon status.
	Luton sixth-form college has a remarkable record of achievement, of which I am very proud, although I may say that I can take no credit for it, being merely a governor. However, those colleges have not been given the funding they require, and they could do a better job if they had it. Classes are sometimes too large and the teachers less well paid than in the schools. I am not suggesting that school teachers should be less well paid, but there should at least be parity for sixth-form colleges. They should have at least the same pay.
	I urge Ministers to press the Chancellor again to provide more funding for sixth-form colleges in particular to close the funding gap with school sixth forms. As I said in a debate last week, sixth-form colleges are so successful that, in urban areas in particular, some schools with sixth forms ought to pool their sixth forms to create new sixth-form colleges because they work so well.

Virginia Bottomley: May I strongly endorse and add to what the hon. Gentleman is saying? Godalming and Farnham sixth-form colleges are spectacularly good, and they have long complained on precisely this point. When he makes representations to the Chancellor, will he please add my name to his and mention Godalming and Farnham sixth-form colleges?

Kelvin Hopkins: I thank the right hon. Lady for a very   helpful intervention. We can all appreciate sixth-form colleges. One of the problems occurred when sixth-form colleges were lumped together with further education colleges—those are fine institutions and I   support them too—by Kenneth Baker, who was the Secretary of State, I think. He was not quite aware of what a sixth-form college was.

Bob Russell: Will the hon. Gentleman confirm that Conservative legislation brought about the anomaly? That said, does he agree that, eight years later, it should have been sorted out?

Kelvin Hopkins: I do not know whether it would be wise to change the status of sixth-form colleges now, but there was a misunderstanding by Ministers when sixth-form colleges were pushed together with FE   colleges. Ministers were not quite sure what sixth -form colleges were. Nor are they quite sure of that now, because there are so few sixth-form colleges and not every Member of Parliament has one in his area or knows quite what they do. All I can say is that if Members are interested in visiting Luton sixth-form college, they can do so at any time. The hon. Gentleman is right that sixth-form colleges have not been given the attention and support they deserve.
	I come to some good news, which is what the Government have done for primary education. That is where we have had our problems. For years, our party argued endlessly about secondary education and ignored primary, relatively speaking, yet it is in primary where basic reading and mathematical skills are learned. It is those schools that were failing: children were getting to secondary school and finding that they could not do mathematics and had poor literacy. They would fail from there onwards.
	The Government have made tremendous advances, however, in promoting primary education, particularly at nursery, infant and pre-school levels, the benefits of which we will see in future. We have a problem with that cohort of children and young people still going through education, who are possibly in their late teens, who suffered the worst of the starved education system 10 to 12 years ago. They missed out on what young children are getting now, and it is a shame that they cannot go back and take advantage of what is happening now. When that cohort has gone through—we will do our best to make sure that they get the adult education or whatever training that they need later—and the new cohort goes through the 14 to 19 system, we will see dramatic improvements, some of which are already taking place. In my constituency, four schools have been in special measures, and all four have been taken out of   special measures, with new head teachers and tremendous resources put in. We have seen some stunning improvements, and I am delighted that they are now doing well.
	The big social divider in Britain has been education. Even in this place, one can see divisions of which we are all conscious, and that is much more the case in the street and in our towns and cities. Compared with many other developed countries, we have deep social divisions, which are essentially educational and cultural in a broad sense. We have tried institutional fixes to overcome those problems with education, and those have not worked. We are now starting to challenge where the problem lies.
	I used to teach A-levels in a further education college, and I remember middle-class students coming to do A-levels, and working-class students coming to do day release. The social division was so great that, even in a further education college, they sat on different sides of the refectory, regarding each other with suspicion and hostility. We used to do experiments by putting those people together in liberal studies classes, and the tensions and frictions were extraordinary. That was 30 years ago, and I hope that things have got better since, but we have a deeply divided society, which is reflected more in attitudes and education than in any other way. Even people who become comfortably off in material terms sometimes have the sense of not having achieved because of their educational level.

David Taylor: Does my hon. Friend agree that given the statistics showing that 7 per cent. of young people are educated in so-called independent schools, and a similar number in state grammar schools, we cannot really be considered a successful, socially reforming Government in a third term until those figures start to decrease?

Kelvin Hopkins: Indeed. I would look forward to a more homogenous education system in this country, in which young people from whatever social background met each other and were educated together, and in which divisions were not reinforced by going to separate institutions, some of which were private and fee-paying. One of my current concerns is that we are seeing a banding out of society even within the state sector, which is worrying. I have made that point many times previously in the House.
	We must try to promote a much more equal society, which is much more together and in which we see ourselves as citizens with equal rights and responsibilities. We have not been through the kind of process through which many other societies have been. We have preserved the social divisions of the past. If I   want to do anything in politics, I want to challenge and break down those divisions and make our society much more equal and together.

Peter Bottomley: I agree with the last part of the hon. Gentleman's speech, and enjoyed and was educated by a good part of the rest of it. The key point is the importance of primary and some middle school education. We have not got transfer to   secondary schools right, and a lot of children go backwards in their first two or three terms at secondary school. May I make a plea to teachers that they try to ensure that a child entering secondary school has a more stable environment, rather than changing classroom and teacher virtually every 55 minutes? If one can embed a child in a new school, the chance of that child blossoming and continuing the kind of progress that they were making in senior years at middle or primary school will increase.
	I am glad that there has been a focus on education, but some of my remarks will not relate to that. I want to start with one or two technical details.
	First, on page 279 of the Red Book, on the definitions used in total managed expenditure, why is there a reference to the national lottery? It states:
	"National lottery expenditures relate to the distribution of the money received from the National Lottery for good causes."
	I thought that when the lottery was created, it was decided with bipartisan agreement that lottery money would not be taken from good causes and brought under central Government control. Although the current Government have made some changes, they ought to reverse that, and I look forward to a Chancellor saying that the good causes money will not come under Government control, that it will go back to the distribution boards, and that the Government will be left out of it. I pay tribute to the lottery lady, my right hon. Friend the Member for South-West Surrey (Virginia Bottomley), for her part in trying to ensure that that did not happen under the previous Government, and I hope that it will not happen under the next one.
	The Treasury team has plenty of good economists and people who can draw graphs, as we see in the Red Book. Why do we not have in the Red Book what we have in the Library guide to economic indicators—graphs showing unemployment in 1992–93, with productivity and investment also charted? Were the Government willing to be fair with taxpayer's money and fair with electors, they would put in their publications the kind of graphs that people could show to a friend and say, "You tell us when this Chancellor came into office, if everything good has come from him." In fact, were we to show most of these graphs, without the dates on them, to an interested person, and were we to ask them to put in the dates on which they thought the present Chancellor had come into No. 11 Downing street—or half of it, given that the other half was taken by the Prime Minister—they would get the timings wrong. We have heard about the 18 quarters of improvement under the previous Conservative Government, and I have every reason to believe that as the Government changes at the next election, I hope—I will work for that—we will see the same kind of improvement, give or take the economic shocks that come.
	There has been some talk about the teaching of economics. We have heard from two of the best teachers of economics, and as probably one of the worst students of economics, I ought to acknowledge that my supervisor, Professor Sir James Mirlees, was awarded the Nobel prize, along with William Vickrey, who sadly died before he could collect the prize. William Vickrey had the rather good idea that in an auction the person who wins should pay the price put forward by the under-bidder. In terms of politics, that is indicated in the current Government saying that they would adopt the   Conservative plans for public spending for the first two years, which is one of the foundations of the relative economic prosperity.
	However, I want to condemn the current Government, and perhaps the Chancellor, for allowing the apparent house price asset inflation, which might have been one of the causes of the economy growing slightly faster than people expected. It is an economic, financial and inter-generational disaster. That raising the stamp duty threshold to £120,000 gives virtually no benefit to people in many constituencies around the country demonstrates some of the impact of that inflation, of which I do not approve.
	I want to comment on the National Audit Office. First, I want to praise the clear writing of its publication, "Audit of Assumptions for Budget 2005", which has a conclusion and recommendation, a useful annexe 1, with details of the unemployment assumptions, showing how the Treasury depends on outside forecasters, and   another page and a bit on the audit of assumptions. But why does a booklet costing £3.75—10 sides at 37.5p   each—use 10 sides when it only needed three and a half? The first side shows the picture of the old British Overseas Airways Corporation headquarters, which is where the National Audit Office is. We do not need that. The second tells us what the National Audit Office does. The third is a repeat of the front page without the picture. The fourth tells us that it has been prepared for the House of Commons. Then we have the three and a half sides that matter. The last side tells us that it was printed by the Stationery Office, the previous side tells us who was responsible for the layout and production and that it is printed on 50 per cent. recycled fibre, the side before that that it is printed in the UK, and the side   before that is blank. May I ask Ministers to have a quiet word with those in the National Audit Office, and ask them to audit the way in which they prepare that publication? I think that £1.30, rather than £3.75, would have been quite sufficient.
	The Government are interested in education. This morning the Secretary of State was scheduled to speak at the launch of the TUC's academy. I was there at the time when she was supposed to be there, but I had to return for a meeting at the House of Commons. I   assume that she arrived virtually on time, and made a good speech. I do support public and Government interest in what trade unions and others do for education.
	In that context, let me say that I wish the Government would review the decision by, I think, the Department for Education and Skills to cut the £52,000 grant to the Woodcraft Folk to nil. The Woodcraft Folk employ five   people and provide activity for 9,000 young people. The Woodcraft Folk were started by the socialists. The Woodcraft Folk appear to have made the mistake of being against the Iraq war. If the Government are penalising them for being a peace movement when their activity for children is just as good as that of the Boys'   Brigade, the Scouts, the Guides, the Sea Cadets, the music groups and the sports groups, I ask the Government to reverse their decision and allow the   Woodcraft Folk to have the £52,000—which, I think, amounts to about 20 per cent. of their income.
	I have two detailed questions to ask. One, which affects a member of my extended family, relates to funding for low-budget films. It is understandable that the Government may want to cut some tax credits applying to high-budget films. I believe that they have extended the low-budget film tax concession for a year. Will they make plain—this is not a request from my relation; it is a point that interests me—whether that extension to, I think, March 2006 is designed to apply to films completed and delivered to the distributors by then, to films in the process of being edited, or to films whose funding has been committed by the sponsors?
	My second point also involves a member of my family. It concerns the change in the stamp duty concession for non-commercial buildings in deprived areas. Let us suppose—again, this is not a request; I am merely interested—that I had agreed to buy a property for a mixture of commercial and residential use. Let us suppose that I had signed the contract but had not completed. Would the building become liable to the new rate of stamp duty, or would the concession introduced a couple of years ago still apply? I do not expect Ministers necessarily to respond to my questions tonight—a letter will do—but they are detailed questions which I think deserve an answer.
	Having criticised the National Audit Office earlier, I   now want to criticise the Government Chief Whip. During the Chancellor's Budget speech the Chief Whip,   and for that matter the Prime Minister, listened with some attention—indeed, I would go so far as to say that they tried to assume expressions of admiration—but as soon as my right hon. and learned Friend the Leader of the Opposition began to speak, the Chief Whip embarked on a running commentary and the Chancellor and the Prime Minister started talking to each other. Perhaps they have not done much talking to each other for the past year, and this was their first opportunity to be side by side, but I disapprove—and so will the public—of the sight of two leading members of   the Government deliberately, discourteously and continuously holding a conversation when they ought to be listening to a response from the Leader of the Opposition. I hope that, if the Chief Whip accepts my criticism, she will tell her senior colleagues to improve their behaviour when they are in opposition, and also tell them that they do not deserve to hold their current titles if they behave in such a way on the Floor of the House of Commons during a major set-piece debate.
	Let me now deal with some of the details of the Chancellor's speech. A number of Members have referred to the free local bus travel for retired people. The documents produced by the Treasury at the time of the Budget made no distinction, in terms of time, between the £200 for retired households on council tax and the free bus travel, but we now know that the council tax concession is for a year. Will Ministers tell us why none of the three or four references to that concession includes that information? Did they decide to make the concession apply for only one year after the papers had been published, or did they deliberately arrange it so that people would mislead themselves when they heard what the Chancellor had to say and read the newspapers?
	Can we assume that the bus travel concession will last for rather longer than a year? May we also know—others have asked this as well—why the Chancellor did not say that it related to off-peak travel? An awful lot of pensioners will find themselves in what is called the "twirly group". The bus driver, or conductor, tells them "You're too early." That certainly happens in London. I do not complain about it myself. I might be affected by it on occasion, but I walk to work. Nevertheless, I   believe that Ministers should make plain in documentation what they are actually saying. They are clever enough to do that—or at least their advisers are   clever enough to ask "Minister, do you really mean this to be off-peak only? If you do, why not say so?"
	Will all people over 60 be able to travel free on all local transport, or will they be able to do so only on transport in their own areas? I am not arguing either case; I merely ask the Government to make plain which will apply. I   feel that when several million people are likely to be affected, documentation should make such things clear so that the next day, when they are reported in the newspapers, people know where they stand—or where they will sit, if there is room on the bus.
	Then there is local government finance. There are two ways in which people are being helped with council tax. One is the provision of emergency money for local authorities to ensure that council tax rises in this election year—assuming that there will be an election this year—are kept relatively low, not more than two or three times the inflation rate. The other is the provision of an extra £200 for pensioner households—which, as has been said, is not nearly as good a concession as what the Conservatives will offer at the election for the future. Incidentally, that is one of the few political promises made that involve no losers: either people are not affected, or they gain. It is a clever bit of public funding.
	What we have not had from the Government is any indication that they will provide a buoyant source of revenue for local authorities—district, borough, unitary and county councils. I would say to my party's Front Benchers that when we are in government, the first thing we should do is try to arrange all-party talks and discussions with the Association of Local Authorities to   work out how the Chancellor can say to local government, "We will make sure that you have a share of some of the rising revenues, and will not have to depend on Government or parliamentary decisions affecting revenue support grant."

Kelvin Hopkins: Was it not the hon. Gentleman's party that put the uniform business rate in the hands of central   Government? Would not handing it back to local authorities be one way of achieving what he wants?

Peter Bottomley: There may or may not be arguments in favour of that, but it would certainly not provide a buoyant system of revenue for local government. Buoyant revenues are income tax, fuel duty, penalty taxes on cigarettes and alcohol and so on. VAT, for that matter, is a buoyant source of revenue; but the business rate on its own is not.

Andrew Stunell: The hon. Gentleman is beginning to make a very satisfactory case for a local income tax. Would he care to give his views on that?

Peter Bottomley: Yes. Let me also say that Margaret Thatcher and the Conservatives could not have saved the country in 1979 if there had been many more than 11 Liberal Members of Parliament. The politics are very simple, as are the arguments about council tax. There were too many Labour Members of Parliament. If we ask when people last voted Liberal as an answer to any serious national problem, the generous answer is 1906.   As for the Conservatives, we are at our best the national interest party—that is, part international, part   national, part local. I shall be happy to debate the details of council tax for the next three weeks, if the   election is going to happen when it is expected.
	I could say much more, but, as well as praising the schools in my constituency—the sixth-form college, the further and higher education colleges, Worthing and Northbrook colleges, and the high schools, middle schools and first schools—I want to say a little about general economics. Under this Government, the household saving ratio is less than 6 per cent., yet when the Conservatives were in government it was 9 or 10 per cent. Saving is even more important than people's assets rising simply because of house price inflation. I look forward to the day when a Chancellor will say, "I have been successful in encouraging people to save voluntarily and in increasing the savings ratio to 10 per cent. or more."
	I am not saying that we should strive for the levels achieved in Germany, but I do believe that we should get voluntary saving back to its previous level, because that is one way in which to encourage people to be self-reliant. Encouraging more people to be self-reliant not only provides economic benefits but enables us to give more help to those who need it. We cannot help everybody all the time; rather, we need to persuade more people to be more independent more often. That way, we can give generous help to people when they need it.

Andrew Love: I begin by saying how much I enjoyed the speech of the hon. Member for Worthing, West (Peter Bottomley), and I   want to pay him a compliment, although he may not look on it in that way. If I had listened to his speech on the radio, I would have found it very difficult to decide which side of the political divide he is on; long may that continue. I should also like to endorse what he said about the Woodcraft Folk. As he rightly says, the Government should revisit that decision.
	Of course, being on the Labour side of the political divide, I greatly welcome the Budget, and for several reasons, the first of which is the promise that it holds out for a number of key groups in our society, including pensioners, savers, single parents—they have not been mentioned much today; indeed, they rarely get a mention—and first-time buyers, who have been referred to consistently throughout. Secondly, as Members of all parties have pointed out, and as it is important to stress, the Budget provides a modest fiscal tightening, which is characteristic of this Chancellor. It is a prudent Budget and stability is at its very centre. That is key to what we are trying to achieve, but we also want economic growth and to improve living standards for the people of this country.
	I want to address some of the criticisms that I have heard from the Opposition not just today but in the past few days' discussion of the Budget. Although it has been rather grudgingly admitted that the Budgets between 1997 and 2001 were good, it has been argued that, miraculously, those between 2001 and now were comprehensively bad. I want to examine the impact of all those Budgets on the real economy, because that is what affects our constituents. Employment has been much commented on today, and we should note that we have the highest employment rate on record. The current employment rate is nearly 75 per cent., which is one of the highest figures internationally. That is a major success story for this Chancellor and for the past eight Budgets. Of course, we also have the lowest unemployment rate for some 30 years.
	According to the new measure, inflation is running at 1.6 per cent., and it will drift up slowly to the target figure of 2 per cent. by 2006. Of course, the fact that that is the lowest figure for 30 years endorses the decision taken very early on by this Government to make the Bank of England independent. That decision has also resulted in the lowest interest rates for 35 years, from which this country's 18 million home owners have directly benefited.
	Growth—the usual measure of economic success—was 3.1 per cent. in 2004, despite the fact that almost every single independent forecaster predicted that it would be much lower. This year, the figure will be 3 to 3.5 per cent., and next year it will be 2.5 to 3 per cent. Each of those figures is above the economy's trend growth rate and better than other comparable European countries' growth rates. Indeed, our economy even grew during the international recession of 2001–02. Ours is therefore a record to compare with anyone's. The icing on the cake is the fact that living standards in this country since 1997 have improved by 50 per cent. on average. By anybody's judgment, that must be a record to be proud of.
	The Tories claim that all this is the result of the prudent measures implemented by former Conservative Chancellors; indeed, one Member even claimed his small share of the credit for the benign economy this afternoon. I am surprised that even the hon. Member for Twickenham (Dr. Cable)—he is not with us this afternoon—has not laid claim to some of the credit for the benefits that the economy has delivered. It is natural that the Tories would want to claim part of the glory, but they cannot then continually take great delight in telling us, "You've been in government for eight years. You have to accept responsibility for the decisions taken during that time." We do: we accept responsibility for the good economy, as is right and proper. It is also right and proper to point out that the mid-1990s—during which time two Conservative Chancellors introduced new policies—signalled the end of a very deep recession, so growth was almost certain to happen at that stage. The unique trick of this Chancellor and this Government in the past eight years has been to sustain growth, stability and improvement in the real economy. That has to be recognised.
	I share the view of my hon. Friend the Member for Luton, North (Mr. Hopkins) that there has been a lot of alarmist talk about the economy, not just from the official Opposition but from both Opposition parties. They have taken great delight in highlighting the most pessimistic forecasts of the so-called independent forecasters, even though they have been consistently inferior to the Treasury's. There is also the myth of the   so-called black hole, which, according to the Opposition, has existed for many years. However, it looks almost certain that when the current economic cycle comes to an end, the Chancellor will easily meet his fiscal rules.
	The negative impact of increased interest rates has been focused on, yet it is clear that there is significant international confidence in the UK economy. Money continues to flow into our economy, perhaps partly because of the malaise in the eurozone and the   difficulties currently experienced by Japan. The American economy is obviously doing well in attracting significant funding, but the UK economy continues to enjoy the confidence of the international community. There is no reason to think that that will change.
	What really stuck in the Opposition's craw was having to give credit to the Chancellor and the Treasury for the fact that their forecasts have continuously and significantly outperformed those of the so-called independent research bodies. Everyone, including the Chancellor, would have to accept that forecasting anything further than a year or two into the future is a very shaky business. Of course, we have annual Budgets and a pre-Budget statement in order to be able to take into account any difficulties that might emerge in the national or international economy, and that is what we would do, should those circumstances arise.
	I congratulate the Chancellor on a number of the announcements in his Budget. He told us that the Gershon review, which will cut out waste and bureaucracy and redirect investment to the front line, has now started. According to the Budget statement, £2 billion has been saved through value-for-money studies and another £2 billion through improvements in procurement. Several posts have disappeared and are now being reallocated to front-line services. However, the Gershon review is predicated on   the view that delivery at the front line should not be   put at risk. That differs from the so-called James review, which Conservative Members mentioned. When Gershon was asked about the figures in the James review, he raised the question of whether it would be able to deliver on front-line services. I ask the same question again this evening: will it deliver?
	The other key question is where the £35 billion-worth of cuts will come from. We already know that the Tories are going to pinch the Gershon review's £21 billion or so savings and redirect them into front-line services, but that still leaves £14 billion unaccounted for. We know that the Conservatives—supposedly members of a party that proclaims itself a great supporter of small business—are prepared to cut the Small Business Service. They are also prepared to cut the new deal. We   all know that they do not care about youth   unemployment; frankly, they do not care about unemployment at all. As a former Tory Chancellor said,   unemployment is a price well worth paying.
	Added to that £14 billion under the James review, the shadow Chancellor announced a further £35 billion-worth of cuts for the future. We have absolutely no idea where those cuts will come from. It was argued earlier that £11 billion or £12 billion was an enormous amount, so we should remember that £35 billion-worth of cuts, even if spread over a number of years, would have an enormous impact on our economy. If we do not find out where those cuts will fall, we shall have to assume that front-line services such as education and health will be affected.

Ian Gibson: The last time that the shadow Chancellor estimated cuts that the Tories would impose, he disappeared into the depths of Dorset or somewhere down there. Does my hon. Friend recall that happening during the last election?

Andrew Love: I certainly do, and the figure that was estimated then was considerably less than the current figure that the hon. Gentleman is trumpeting. It is interesting to note that, a month or two ago, the Opposition were announcing that they would reduce public expenditure, but they are now saying something quite different. I suspect that one of the Tory Front Benchers will disappear as we approach the general election.
	I also congratulate the Chancellor on staying within his fiscal rules. If we compare that with what has happened in Europe with the growth and stability pact, it shows how clearly the Chancellor has the confidence of the international community because he sets rules and stays within them. We have heard a lot in the past few days about the mythical so-called black hole, but the Chancellor's forecast in the Budget is that at the end of this economic cycle, under the golden rule, we shall be at least £6 billion in surplus. As to the sustainable investment rule, £57 billion will be the measure of his ability to sustain investment in the economy. Even with the private finance and other initiatives that do not appear on the Government's balance sheet—the Opposition continually talk about them, even though they are only 43 per cent. of overall PFI credits—the Chancellor still remains well within his sustainable investment rule.
	I also congratulate the Chancellor on reducing the burden of regulation. We have not heard much about that from the Opposition, despite the fact that it is one of their constant themes. However, we have heard from small business and other business organisations how welcome are the changes to the requirements for the reporting of VAT, which will significantly reduce the burdens that businesses face. The reduction in the   number of regulatory bodies—we shall have to see how it pans out in the future—is also very welcome to the business community. Speaking as a member of the Regulatory Reform Committee, I accept that we have to change the culture in Whitehall and get it to think about reducing regulation as well as increasing it. Only when we have institutionalised that here at Westminster will we get the changes that we want.
	I want to comment on the household savings ratio. I   was going to say that it had not been mentioned by any Conservative Member, but in fact the hon. Member for Worthing, West did mention it. He forgot to tell us, however, that all the Jeremiahs on his side had previously said that the savings ratio was too low; now that it is beginning to increase, they no longer mention it. I am pleased that it has risen to 5.6 per cent.
	Two proposals in the Budget have particular merit, but I would like to see the Chancellor going further with them in the next Budget. I welcome the significant investment—the education sector is relevant—going into public infrastructure. We have invested substantially in recent years, and it is pleasing to see that public investment will rise from 2 per cent. to 2.25 per cent. of gross domestic product in the next couple of years. Over the next few years, a brand new hospital will be built in the most deprived part of north London, which lies in my constituency, and a second hospital in my local authority area will receive significant investment in new facilities. My constituents will be able to use both hospitals and receive a significantly improved service as a result.
	My constituency has also had two new schools—a secondary and a primary school—in recent years and there has been an enormous improvement in the facilities in all our primary and secondary schools. There is a proposal for a local academy and I look forward to it going ahead in the next couple of years. The Budget particularly highlighted the "Building Schools for the Future" initiative, which is an exciting prospect that should help to deliver a completely refurbished secondary sector and additional improvements to the primary sector. It amounts to £9.4 billion-worth of investment over the next five years, which will make a significant difference.
	The Budget statement predicts that by 2009–10 we will invest £6.7 billion in our schools, in comparison with £700 million in 1996–97. That provides a good measure of the investment that Labour is putting into our public infrastructure. All that will bring about higher standards, better results for our kids and real achievements for pupils who live in the more disadvantaged areas.

Mark Francois: I am confident that the hon. Gentleman will be in the Chamber for the winding-up speeches, so I assure him that I shall respond directly to all the nonsense he has been spouting about the £35 billion cuts. We shall take that at the correct time.
	As education is part of our focus in this debate, how does the hon. Gentleman respond to the fact that the National Association of Head Teachers, traditionally a moderate union, believes the working-time agreement to be unworkable in schools for non-contact time and is not prepared to implement it?

Andrew Love: I shall listen carefully to what the hon. Gentleman says about the £35 billion-worth of cuts that the shadow Chancellor wants to make. People tell me that the differences between us are in the rate of growth, but the reality for my constituents is that they will have a choice between the Labour Government and the official Opposition and the difference between the Government and the Opposition is £35 billion-worth of cuts in our public services. It is critical that we get that message across to the electorate, so I assure the hon. Gentleman and all his colleagues on the Opposition Benches that we shall indeed do our utmost to ensure that the message gets across to our constituents between now and whenever the general election is held.
	I take on board the hon. Gentleman's comments about the head teachers union. I understand that teachers have some difficulties, but I hope that they will continue to discuss the issue with the Government. It is an important initiative and it should be introduced. I am confident that the NAHT will be able to reach an agreement in the not-too-distant future.
	I want to touch briefly on some other issues. I was pleased that the Chancellor announced an increase in the inheritance tax limit to £300,000 in two years' time. A considerable number of my constituents are affected by the tax. I am sure that it was never the intention to include so many people in that regime, so I strongly welcome the change. We need more comprehensive reform, however, and I hope that once the general election is out of the way the Treasury will consider the matter more seriously. We must ensure that inheritance tax does not affect families with moderate incomes, but reaches only those who are well-off enough to sustain the burden it imposes.
	On council tax, I strongly welcome the £200 to be paid to every pensioner aged 65 or over. I say "every" advisedly, as that is an important consideration. Our opponents, both the Liberal Democrats and the Conservatives, have been telling everybody all the good things that they are going to do for pensioners, but the official Opposition forgot to say that everyone in the household has to be over 65 to receive the benefits they are offering. That proposal falls adversely on the less well-off. The Conservatives would pay more to the well-off and less to the less well-off. Our proposal would reach more pensioners and provide more support to the poorest pensioners, which is important.
	The Liberal Democrats forgot to tell better-off pensioners that their income tax proposals will have an impact on them. If the Liberal Democrats were more honest about the impact of their so-called local income tax, they might recognise the merit of what we have been saying: our proposals will improve the situation for more pensioners.

Angela Watkinson: The hon. Gentleman said that our £500 discount applied only to pensioner households where both members were aged over 65. He may be pleased to hear that it will also apply to couples aged over 65 who are caring for a younger son or daughter who has learning difficulties or a disability. The fact that there is a younger person in the household will not affect the eligibility of the couple aged over 65 to the discount.

Andrew Love: I genuinely welcome that comment, but the official Opposition appear to be making yet another change on the hoof. Only two days ago that was not the case, but now things seem to have changed, so it just goes to show what a miraculous thing a good Budget is. It has an impact not only on the Labour Benches, but forces the Opposition to change their mind and to improve the situation.

Andrew Stunell: The hon. Gentleman commented on the Liberal Democrat proposals to replace council tax with a local income tax and suggested that there had been a failure to describe the winners and the losers. In fact, we have made it clear that half of the pensioners would be beneficiaries, a quarter would have no change in their current payments and a quarter would pay more. The quarter who would pay more would be people with large private pensions that brought their income above £27,000 a year. That is not a secret. We have made it very clear. We believe it right and proper that those with the greatest means should make the greatest contribution. Is not that a principle that the hon. Gentleman accepts, too?

Andrew Love: I certainly welcome the open and transparent way in which the hon. Gentleman defines who will and who will not benefit from the Liberal Democrat proposals. The important point that I am trying to get across is that more pensioners will benefit from the proposals in the Budget than from the other two parties' proposals.
	It is important to highlight the Government's balance of funding review, which, I hope, will report later this year, because two urgent issues need to be taken on board in any review of local government finance, the first of which is the business community's contribution. For some considerable years, increases in the unified business rate have been held to the rate of inflation. Such increases are no longer sustainable, and I hope that the Government will seriously consider, in discussion with the business community, its contribution in the future.The second issue is the regressive nature of the   council tax. Of course, the intention of Her Majesty's Opposition when they introduced it when in government was that the council tax should be totally regressive.

David Taylor: Of course, my hon. Friend is right to urge that the uniform business rate be returned to local level, but in doing so does he agree with me and those from small businesses who attended the chamber of commerce dinner that I addressed on Friday, that attention should be given to the fact that very small businesses pay a higher proportion of their revenue in business rates than the very large ones do, and that the valuation system for businesses needs a major review before anything is returned to local level?

Andrew Love: I may have inadvertently said something that I did not intend, but I have not called for the abolition of the unified business rate and we need to continue to look at the return to local level. What I was calling for is a greater contribution from the business community towards the overall funding of local government, but the point that my hon. Friend makes is valid: small businesses are more adversely affected than larger ones and, again, that must be part of an ongoing discussion. It is crucial that we foster our small businesses. We are doing something in terms of regulation and we need to consider the impact of   taxation. Of course, one of the most important aspects of the taxation system for small businesses is the unified business rate, so it is right and proper that we should consider that.
	We need to focus on the regressive nature of the council tax. I do not know whether the Government or the balance of funding review will recommend that we abolish or change the council tax. Whatever happens, we need something that is a good deal more progressive if we are to have a system of local taxation that has the trust and confidence of those who pay it. That is the   critical factor.
	We have had a lot of argument across the Chamber about what proportion of our gross domestic product should be taken by the public sector. Depending on whom we speak to, the proportion can be anywhere between 30 and 40 per cent., and it may rise or fall a little. I find a lot of that debate rather sterile. What we need to look at is how the resources used in the public sector are raised and whether we are being as fair as we should be across the community in the way that taxation falls on the well-off and the less well-off.
	I reflect comments made by hon. Members on both sides of the Chamber when I ask whether it is right that those in the bottom 10 per cent. of the income scale pay a higher proportion of their income in tax than those in the top 10 per cent. That is a matter of proportionality and fairness. If all sections of the community are to support what the Government do and how they distribute the taxation that they raise, we must have a system that is seen by everyone to be fair.
	Finally, I am sure that when the hon. Member for Rayleigh (Mr. Francois) speaks on behalf of the Conservative party, he will have not only the Budget but the forthcoming election in mind, as have Labour Members. This modest Budget continues the path of stability and growth set by previous Budgets. It provides investment in our public services into the future, which is critical, and gives us a platform to show what the Government have done for the economy and public services, in contrast to the proposals of the two major Opposition parties. The public will see that we have a good Budget and a Government who can be trusted with the future.

Angela Watkinson: I shall confine my comments almost exclusively to early years education, which is important. In his Budget statement the Chancellor promised 1 million child care places over the next five years, but it was not clear how many of those places would be for early years education. We must put the figure in context because since 1997 there has been an estimated 22 per cent. fall in places in playgroups and pre-schools and a 24 per cent. fall in child minder places. The greatest increase in places has been for out-of-school and holiday child care where there has been an increase of 134 per cent., but pre-school child care provision is falling in many areas.
	Early years provision comes in many guises: child minders, crèches, play groups, Sure Start and a range of nurseries, including workplace, private, charity and those attached to primary schools. That diversity is important because it caters for a wide range of need. Working parents need a safe place for their children, run by kind, responsible people. Some parents simply want an opportunity for their children to socialise, to meet and play with other children and to get used to other adults. Others want their children to get a head start in learning before they go to school. Single parents may need more support with parenting skills and social problems.
	When early years education is discussed the emphasis is often on eligibility, cost and the level of supply. It sometimes sounds as though the provision is for the convenience of parents so that they can go to work. In whatever setting a young child is placed, the priority should be on the quality of provision, the benefit to the child and what the child gets out of it. Early years placements are not warm storage with lunch until the child is collected at the end of the day.
	I have discussed early years provision with a range of providers: private nurseries, primary school nurseries, child minders, the National Day Nurseries Association and the National Campaign for Real Nursery Education. There are many examples of good practice and a good deal of consensus on what very young children need to give them the best start in primary school when formal learning begins. We will give primary schools direct control over their finances to spend as they know best.
	Many children are lucky and have parents who talk to them, teach them good manners, play with them, eat with them at a table when the day's experiences are discussed, and read to them. Any parent who has read a bedtime story to a child knows what a rewarding experience that is. Other children are not so lucky and come from homes where there are no books, meal times are informal and the television is permanently on. The communication of such children is often delayed due to lack of the right experiences.
	I was in an infants school recently where one third of the children have special educational needs. They had been asked to write about their morning. The school learned that a significant number of those children get themselves up in the morning, wash themselves, dress themselves, make their own breakfast—or not—and when it is time for school they wake their mother and ask to be taken to school. It is very useful for infant teachers to have that sort of information, so that they understand the level of responsibility that is sometimes put on extremely young children.
	Early years settings are useful for the early identification of special educational needs and speech and language difficulties. Whatever the type of early years setting, it is where children can learn their social and interpersonal skills, learning through play, singing, acting and games, creative activities and exploring the outdoor environment. Learning to give and take, share, be part of a group and to accept authority without feeling the need to kick against it are all essential life skills. People who do not have them often have a difficult journey through life and, more particularly, children who do not have them often have problems in school.
	The Government have announced that there will be five Sure Start children's centres in every constituency by 2010. I have a very good centre in Harold Hill, the most deprived ward in my constituency. It is doing extremely good work and provides wonderful support for those parents who need it, some of whom are very young single mothers who are barely out of childhood themselves.
	However, I have two concerns about children's centres. The first has been raised with me by the National Day Nurseries Association, which feels that ideally every children's centre should have a nursery school incorporated in it. Some do not at the moment and provide only social support. The other is that children's centres may squeeze out other providers, but it is important that a range of provision is available. Not all parents have social problems and need all the additional services provided by Sure Start, but they do want a nursery place. We need to ensure that the closure of other child care places is no longer a consequence of opening new Sure Start facilities, as was reported by the National Audit Office statistics in 2003. For every child care place the Government have created, another has closed down elsewhere. Valuable though Sure Start is, it should not be the only type of child care on offer. The different types of child care—provided by the state, the private sector, voluntary organisations, charities and faith groups—must all coexist without Sure Start being predatory on the others. Already, many new providers do not last beyond their start-up funds. That causes instability in the system and is very unsettling for young children who have to move away from the place where they are happy.
	The cost of child care is a major problem for the very parents who need a second income to make ends meet. Child care in Britain is still the most expensive in Europe. A nursery place costs the average household one quarter of its total income.
	The Chancellor announced that the child element of the child tax credit will increase in line with average earnings up to 2007–08. But one increase in just one element of the tax credits will do nothing to stop the chaotic tax credits system from putting thousands of families into financial insecurity and hardship each year. One in every five tax credit claims received by the Inland Revenue is processed incorrectly and up to £700 million a year is   overpaid in error. Overpayments are later clawed back by the Inland Revenue, leaving thousands of families in "significant financial hardship"—according to the 2004 parliamentary ombudsman's annual report.
	Citizens Advice, and many Members of Parliament, are deluged with distress cases caused by official tax credit mistakes. Katie Lane of the CAB said:
	"We see thousands of people in hardship as a result of their payments being cut".
	By December 2004, the Inland Revenue had received 78,000 complaints over the recovery of overpayments. Errors abound in spite of the vast resources poured into the system. Tax credits cost £406 million just to administer in 2003–04, and 7,500 staff were needed to   run the system. The system is far too complex and needs reform to make it easier to administer, so people can make some sort of judgment about whether the tax credit they receive is right or not.

Andrew Turner: My hon. Friend will not be surprised to learn of a case in my constituency of a mother who is faced with the recovery of tax credit. The process began in August last year. I   wrote to the Department in September, but the case has still not been resolved and the lady has had to remortgage her house in order to pay back the Inland Revenue.

Angela Watkinson: I thank my hon. Friend for that intervention. Sadly, that is all too typical of the stories that we hear in our surgeries from people who have been overpaid but are unable to make the repayments.

Andrew Stunell: I am following what the hon. Lady is saying and I have great sympathy with her point. Does she agree that it is quite unreasonable for the Inland Revenue, having made a mistake, to blame the recipient for failing to detect it and to impose a repayment schedule of sometimes purse-breaking proportions?

Angela Watkinson: I thank the hon. Gentleman for that. I agree absolutely; the repayments are often unmanageable. It is galling for people to be told by the Inland Revenue, "Yes, it is our fault, but it is your fault for not knowing that it is our fault." I ask the Minister to bring pressure to bear not only to simplify the system but to overcome that basic problem.
	A Conservative Government will allocate more funding to early-years partnerships with parents, Sure Start programmes and the national parenting fund, to   support parenting programmes provided by the voluntary and community sectors. In addition, local authorities will be refunded for all VAT incurred in the provision of welfare services such as child care and children's centres.
	I believe passionately that if we get early years right, the long-term benefits will be felt throughout the education system. If every child who enters primary school is self-confident, socially well adjusted and ready to learn, the job of their teachers will be so much easier. Teachers will be able to concentrate on teaching. Of course children will have differing ability levels, but they will all have the opportunity to develop to their individual full potential. The knock-on benefit of successful primary education would then be felt in the secondary sector with, I predict, fewer disruptive or disaffected teenagers and the consequential early retirement of demoralised teachers.
	I was speaking recently to some experienced long-serving teachers who plan to take early retirement not because they are fed up with the job but because they are unable to maintain discipline in the school. One teacher of senior boys said, "Some of these boys are bigger than me and they have attitude, and I am not even allowed to adopt what is described as an aggressive stance towards them—and they know it." That simply has to stop. The awful thing was that he added that a lot of his colleagues were also planning to retire. That large school will see an exodus of experienced staff and therefore an influx of less experienced staff, who will not have more experienced teachers as mentors and role models. That could have a serious effect on the overall management and on attainment levels in the school.
	Getting early years right is not a panacea—life is more complicated than that. The education system cannot make up for all the problems that a child might have, but it can make a major impact. Early years must not drop down the list of priorities to make room for after-school clubs and holiday care. I hope that the Minister will take up that point specifically in his summing up.

Mark Hoban: One of the issues that will be at the core of the debate over the next few weeks is how we improve our public services. One reason why people question the growing burden of taxation is that, although they have seen their taxes rise over the past eight years, it is difficult to discern the improvement in our public services.
	I echo the comments of my right hon. Friend the Member for North-West Hampshire (Sir George Young) about some of the issues we see in our communities. My primary care trust, rather like his, is suffering from a financial deficit this year and is trying to make it up, but I suspect that it will end the year with a deficit, which will need to be recovered next year.
	It is difficult for my constituents to find a NHS dentist, despite the Prime Minister's promises about ensuring that everyone would have access to one. A dentist in Fareham treating NHS patients is as rare as hen's teeth. If people cannot find an NHS dentist, where has all the money that has been spent on the NHS gone?
	Council tax bills have risen by 70 per cent. since the Government came to office. The Chancellor's one-year-only council tax rebate is a bribe or a con—people know that their bills have gone up because of the transfer of resources from the south to the north. In south-east Hampshire there is greater pressure on our infrastructure as a consequence of housing developments. Major routes such as the M27, the A27 and the A32 are clogged up at rush hour as more and more people seek to use the same stretch of road. There have been no major road schemes in Hampshire, however, for the past five years.
	People want to know where the money has gone and how their increased taxes have been spent. Part of the answer concerns the way in which the Government have sought to manage and control public services. We have witnessed the development of a tight, rigid, centrally driven and controlled framework that has absorbed money in the processes of monitoring, recording, inspection. I shall give some examples, to demonstrate where the money goes on many occasions. Late last   year, the Government produced an outcomes framework for their Green Paper, "Every Child Matters". It is a complex document that sets out various outcomes, inspection criteria and public service agreement targets. There are 26 PSA targets for the agenda of "Every Child Matters" involving nine Government Departments and agencies, ranging from the Department for Work and Pensions to the Crown Prosecution Service. In addition, there are 18 key indicators and 52 separate inspection criteria. The targets range from targets to reduce child obesity and mortality to targets on the take-up of cultural and   sporting opportunity by over-16s and on the number of young people taking part in mock elections.
	There is clearly a mechanism in the 24,000 schools throughout the country to count the number of people who vote in mock elections. The bureaucracy involved in analysing and reporting on those inspection targets sucks money out of front-line services, and prevents improvements from being made to our schools, hospitals, and in terms of safety on the streets. Last year, the Government decided to draw some of those measures together, and I shall demonstrate the extent of the burden. A document that accompanied last year's Budget was entitled "Devolving decision making: 1. Delivering better public services: refining targets and performance management." Chart 2.6 in chapter 2 sets out the number of targets and external controls facing the health service. The number of external controls on front-line health staff is 17 times greater than the number of headline public service agreements. There are12 PSAs, 23 PSA components and a further 58   PSA-related targets, measures and compliance requirements. In total, there are 81 PSA-related targets measures and a further 125 targets.
	In education, there are six PSA targets, 27 PSA components and a further 13 PSA-related targets, measures and compliance requirements. There is a total of 40 PSA-related targets and, in addition, there are 167 non-PSA-related targets, measures and compliance requirements. Paragraph 2.26 says that the number of external controls facing police forces "follow a similar pattern". It is not surprising that the chief constable of Nottinghamshire police was moved in last weekend's press to complain about the amount of paperwork with which his force has to deal. This week, the chief constable of Surrey police said that about 90 per cent. of police officers' time is taken up in some shape or form with targets, monitoring and reporting.
	If the Government were serious about the agenda set out in the Red Book, we would see a reduction in the number of targets, but I do not believe the Government are serious. They set out in the Red Book their plans to merge a number of inspectorates and replace them with a thematic inspector to look after a number of areas. They refer to creating a single justice and community safety inspectorate, bringing together five existing inspectorates. But merging all those inspectorates is not the way to cut down the burden of inspection. What people want is a more streamlined inspection process, not the old process re-badged.
	The hon. Member for Edmonton (Mr. Love) spoke hopefully about the reduction of bureaucracy. He ought to bear in mind that the Chancellor has spoken of a reduction in bureaucracy in a number of Budgets, yet has conspicuously failed to deliver a reduction in red tape. If people in our public services believe that the merging of inspectorates will result in less bureaucracy, they should listen to people in business to find out how hollow those claims are likely to be.
	The problem is not just the targets and the bureaucracy, but how decisions are made in our public services. Too many decisions are taken not out on the front line, but centrally. We gain a remarkable insight into the way the Government's mind works in the Red Book, in the chapter entitled "Delivering High Quality Public Services." The Government have a curious view of the role of professionals in public services. They say, perhaps with a note of surprise:
	"Engaging the knowledge and experience of public service professionals in the design of public services has the potential to make services more efficient and tailored to users' needs. In developing future public service reforms, the Government will examine the way in which employees' and professionals' input is used in the design of policy and the provision of services, ensuring a constant flow of information and ideas between policy-makers and the front line."
	Most professionals in our public services assume that to date the flow of information has been in one direction—from the centre to the front line—and has not been an exchange of views.
	It is breathtaking that a few weeks before the general election, in their eagerness to address the concerns of professionals, the Government suddenly realise that professionals can make services more efficient and can ensure that those services are tailored to the needs of users. If we free our doctors, nurses, teachers and police to deliver the services that local people want, we will see a transformation in our public services. Too often the problem is that the Government decide that there is a one-size-fits-all solution to the needs of every part of the country, not recognising that the needs of Fareham, for example, are quite different from the needs of a community in the north-east. If we do not free up professionals to make those decisions on the ground, we are unlikely to get the public services that individual communities need.
	The issue is not just the role of professionals in helping to deliver better public services. In paragraph 6.35 the Red Book refers to involving users in the delivery of public services. It states that
	"the Government aims to involve users more closely in the design, delivery and governance of public services, recognising their critical role as co-producers."
	But involving people in the design of public services is about more than getting them involved in the governance of local services. What is needed is an extension of choice in many areas of public services, to enable users to tailor the services to meet their needs—to give parents the power to choose the school that best fits the needs of their child, or to give patients the opportunity to choose a hospital that has a lower rate of hospital infection, a shorter waiting list for a particular condition or a consultant with an excellent record in a particular condition, rather than being forced, as they are now, to go to the hospital that their primary care trust has a contract with, even though that hospital might not be the right one to meet their needs.

Andrew Turner: My hon. Friend has hit the button precisely. There is a world of difference between a member of public being able to sit on a governing body, whether of a school or a foundation hospital, and his having the ability to choose the hospital that best delivers his needs. Is it not astonishing that we expect people to go through the bureaucratic procedures of involvement in governance when they could go through the so much simpler procedures of having the opportunity to decide where to obtain the service that they want?

Mark Hoban: My hon. Friend is absolutely right. In reality, there is no substitute for choice in terms of delivering the service that people want. If they are able to choose their child's school or the hospital in which to have their operation, services will be tailored to match their needs. Too often, involvement in boards and other forms of governance is seen as a substitute for real choice in our public services. Placing too much emphasis on that puts us in danger of taking away the most simple mechanisms for people to ensure that their wishes can be heard, their views expressed and their voices listened to directly by organisations, instead of having them ignored or ridden over roughshod by public bodies and by the Government.
	This Government have been a tremendous example of the way in which services can be run on the basis of a single sense of direction that is determined from Whitehall, not at a local level. As a result, priorities are not set in our local communities. Parents do not have the choice of schools that they believe that they should, but are forced to choose from a very narrow range with their choices restricted by a Government who have a clear sense that what they believe is right. That arrogance of centralised direction and control has absorbed much of the money that they have raised from taxpayers. The "Government knows best" approach stifles much of what is done well in our public services. In recent weeks, I have talked to teachers who feel as though they have become de-professionalised—that there is so much that they are told to do by central Government that they are moving away from being professionals towards being technicians. Many in the public sector worry that they are losing their autonomy and sense of decision making as individuals because of the way in which the Government, through public service agreements, targets, monitoring and control, have sought to remove some of their discretion and independence in improving public services.
	If we strip out much of the bureaucracy in Government, we can afford to spend more on our front-line services. We can ensure that our doctors, nurses and teachers—all those in the front line—have the opportunity to mould services in the interests of the   people who use their hospitals and schools and want safer streets. If we strip away that bureaucracy and   centralised direction, we will have an opportunity to develop a pattern of provision that meets local needs and responds to what is happening on the ground, instead of whatever is the current priority in Whitehall. That will allow resources to be spent where it matters and drive the improvement in our public services that so many people are waiting for.
	Our approach to public services distinguishes us from Labour. We will give power to professionals and choice to patients and parents. Our commitment to that is in stark contrast to a Government who suddenly, a few weeks before the election, find out that people are fed up with a fat and bloated Government and try to amend the   centralising agenda that has demoralised our professionals and angered our constituents, who cannot see where their taxes have gone. If we are to ensure that the planned additional spending on health and education is spent well, we need to give professionals freedom, give parents and patients choice, and above all give taxpayers value for money.

Mark Francois: It is a pleasure to sum up for the Opposition at the end of what we can all agree has been a fairly lively debate. I shall endeavour to refer to every contribution in turn, because a considerable number of interesting points were made, which I shall try to draw on as best I can. We look forward to debating such matters in further detail after the Finance Bill has been published, which I understand will take place on Thursday 24 March.
	Before I come on to the debate itself, I would like to   say a brief word about the Chief Secretary to the Treasury, the right hon. Member for Brent, South (Mr.   Boateng), whose office was informed that I   intended to refer to him this evening. As the House will know, he has announced that he will be standing down at the forthcoming general election so that he can take up important work in Africa. It strikes me that a wind of change is blowing through the Treasury—it might have further yet to blow.
	I stood in the right hon. Gentleman's neighbouring seat of Brent, East in 1997, so he and I go back at least a little way. I pay a brief tribute to him tonight and say that although the House will miss his shy and diffident style at the Dispatch Box, in an age in which it is fashionable to talk about faceless politicians, he, in all seriousness, has clearly been an exception to that. Our future deliberations will be the poorer for his not being present to participate in them. Perhaps his good friend the Economic Secretary to the Treasury will be kind enough to pass that message on.
	The debate was opened by the Education Secretary. I   do not mean to be uncharitable to her, but although she spoke a great deal about Sure Start, she did not actually provide one for the Government today. Frankly, she went over the top. I have heard her speak better than that and hope that we will hear her speak   better again. I am afraid that today was not her   best run out.
	My hon. Friend the Member for Westmorland and Lonsdale (Mr. Collins), the shadow Education Secretary, responded to the right hon. Lady in his typically robust style. Among other things, he wisely pointed out that with this Chancellor one always needs to read the small print. He gave a specific example from the innards of the Red Book on the direct funding of payments to head teachers. He then pointed out quickly that what the Government had said last week had already been qualified in the Red Book that was published only a few hours thereafter. I wish to return to the tendency to need to read the small print in the Chancellor's Budget later in my speech.
	We then heard from the hon. Member for Norwich, North (Dr. Gibson), who is well known in the House for   his implacable opposition to the introduction of university top-up fees. The bulk of his colleagues might not have been loyal to their party's 2001 manifesto, but he was. He delivered a thoughtful speech on scientific issues, especially the operation of stem cell research in the United Kingdom. I am not an expert on such matters, but I am sure that his points will have been noted with interest by those who are.
	We then heard from the spokesman for the Liberal Democrats, the hon. Member for Harrogate and Knaresborough (Mr. Willis). I think that he was the only Liberal Democrat to make a speech in the debate.

Desmond Swayne: Where is he?

Mark Francois: I do not know; I am not responsible for his diary.
	The hon. Member for Harrogate and Knaresborough made the point that the Learning and Skills Council has grown like Topsy over the past few years, and I think that Conservative Members have sympathy with that statement. He rightly pointed out that the £330 million administrative cost of the LSC has increased markedly, which is one reason why Conservative Members think that the money could be spent better in an alternative way.
	The hon. Gentleman spoke for more than half an hour, but he did not once mention the Liberal Democrats' intention of abolishing Ofsted, which, as we know, provides parents with an independent assessment of the success or otherwise of their children's schools. Bearing it in mind that that was a big announcement made by the Liberal Democrats only a week ago, it was interesting that in a debate specifically on education, their Front-Bench spokesman omitted to mention that that was their plan. I would love to put that point to him, and if he turns up in the next few minutes, I shall endeavour to do so.
	I was perhaps a little hard on the hon. Member for Brighton, Kemptown (Dr. Turner) when I intervened on him. All I would say in my defence is that I was sorely provoked by my hon. Friend the Member for New Forest, West (Mr. Swayne) and could not resist the temptation. In fairness to the hon. Gentleman, he made some interesting policy announcements on behalf of the Labour party, including further significant rises in the   taxation of petrol and, as he put it, punitive increases in taxation for people who drive 4x4 vehicles, which he characterised as Chelsea tractors. He seemed to be under the impression that they are driven only in Chelsea. If he visited my constituency, we could rapidly disabuse him of that. It will be interesting to note whether the Economic Secretary endorses any of those policy proposals in his summing up. We would be very interested if he did.
	My hon. Friend the Member for Boston and Skegness (Mr. Simmonds) delivered a typically robust speech. He analysed the Budget's impact on his constituents and gave several specific examples. He rightly pointed out the need to plan to compete not only with our European partners or the United States, but, looking further ahead in the 21st century, with the economies of China and India. To be fair to the Chancellor, he has also made that point, but my hon. Friend's prescription for doing that in practice was more credible than the Government's. I pay tribute to him for that.
	The hon. Member for West Bromwich, West (Mr.   Bailey) spoke about several specific constituency issues. He clearly spoke from the heart. He also informed the House of his self-denying ordinance about the kissing of babies during election campaigns. It is up to each individual Member to campaign as they see fit and we shall see, when the votes are counted, whether the hon. Gentleman's intention has a dramatic effect on his result. There are many ways of effecting a swing; we shall see how that one works in practice.
	My hon. Friend the Member for Ruislip-Northwood (Mr. Wilkinson) made what he announced would be his valedictory speech in the House of Commons. He used the opportunity to advocate a personal list of fiscal measures.

Andrew Stunell: Are they all in the Conservative manifesto?

Mark Francois: I fear that they are not necessarily all there. Nevertheless, as a Back Bencher, my hon. Friend used that freedom to make his case.
	I understand that my hon. Friend was first elected to Parliament in 1970. Even though I have been in the House for only some four years, I have heard him speak several times, often about defence matters, and often specifically on the Royal Air Force, about which he clearly knows a great deal. Like some in his former service, he has sometimes been one of the few during his political career, but he has consistently stuck to the principles in which he believes. On that basis, from the   Front Bench, even though I have served for far fewer years than him, I would genuinely like to wish him a happy retirement.

Peter Bottomley: My hon. Friend the Member for Ruislip-Northwood has also served with immense distinction and dedication in the Council of Europe and the Western European Union, where both his courtesy and his competence helped to bring together many countries, which, when he was first elected, would not have expected to be alongside United Kingdom parliamentarians in those two great organisations.

Mark Francois: I thank my hon. Friend for placing that important point on the record. I am sure that, whenever he went to the Council of Europe or the WEU, my hon. Friend the Member for Ruislip-Northwood gave them a lot to think about. I also wish his prospective successor, Nick Hurd, all the best in the forthcoming election.
	The hon. Member for Coventry, South (Mr. Cunningham) has been in the House for some time. I   hope that he takes that in the spirit in which it is meant. Being a wise old bird, it was interesting that he appeared to distance himself from his Front-Bench colleagues' claims about £35 billion of cuts in our spending plans. I listened carefully to his words and he used measured language, but he was creating a gap—perhaps not clear blue water, but at least a small stream—between him and his Front Bench.

Jim Cunningham: I do not distance myself from my Front-Bench colleagues, but we had heard so much to-ing and fro-ing about the £35 billion that I thought I   would widen the debate and consider areas where one could save a lot of money, whether it was £35 billion or more or less. My point was that, one way or another, there would be public service cuts under a Conservative Government.

Mark Francois: I listened very carefully to what the hon. Gentleman said earlier, and people can read Hansard and make of it what they will, but it was clear to me that he was opening up a bit of a gap in that regard. Anyway, we will allow people to read the record and see what they make of it. If he still disagrees with me, we can discuss the matter over a glass in the Smoking Room at the next available opportunity.

Kelvin Hopkins: rose—

Mark Francois: I shall gladly give way to the hon. Gentleman, but before I do, I want to ask him which of the 66 tax rises that his party has imposed on the British people, including his constituents, since 1997 he most regrets.

Kelvin Hopkins: Actually, I am asking the questions, not answering them. I thank the hon. Gentleman for giving way. If his party were to get into power—which would be a tragedy for Britain—it might attain the same levels of inflation that it typically had during its previous period in office. If that were to happen, the £35 billion would mean much less in real terms. Is that what he is saying?

Mark Francois: I acknowledge that the hon. Gentleman accepts the possibility that we might win the election in a few weeks' time, and I thank him for that. As he knows, the setting of the inflation target is now a matter for the Bank of England and, as my hon. Friend the Member for Westmorland and Lonsdale ably pointed out earlier, the best way to maintain an independent Bank of England is to vote Tory. I am sure that the hon. Gentleman will share that view, bearing in mind his viewpoint on European matters.
	My right hon. Friend the Member for North-West Hampshire (Sir George Young) gave Ministers some sound advice on not constantly reiterating this nonsense about £35 billion of cuts, and he made his point in a very measured way. I would humbly suggest to Ministers that, given his experience in the House, they might do well to pay heed to the advice that he was offering.
	My right hon. Friend also made an interesting point about the ending of the stamp duty exemption for commercial property development in disadvantaged areas, and I would like to follow up on that if I may. On 17 March, the day after the Budget statement, Jeremy Warner wrote in The Independent:
	"This was an exemption the Chancellor introduced less than two and a half years ago as a way of encouraging business to move into areas of high unemployment. We are now told that this was always intended as time-limited, though it is hard to recall anyone saying this at the time. Bizarrely, its 'expiry' is included in the Budget documents under the heading of 'meeting the productivity challenge'. Even the Chancellor would struggle to sustain the argument that more tax means higher productivity."
	The Independent is not normally thought of as a   Conservative-leaning newspaper, but I hope the Minister will accept that, given the nature of the   Chancellor's Budget, it is perhaps beginning to change its mind.
	The hon. Member for Hartlepool (Iain Wright) spoke clearly in his first Budget debate since he entered the House at the recent by-election. It was obvious from his remarks that he knows a bit about his constituency; he clearly visits it more often than his predecessor did.
	My hon. and gallant Friend the Member for New Forest, West (Mr. Swayne) reminded us that he had taught A-level economics for about seven years before entering the House. He engaged in an interesting discourse with Labour Back Benchers about the merits and intelligence of mathematicians versus economists. All that I would say on that is that if the mathematicians have Albert Einstein on their side, the economists are batting uphill from the opening. He also made an important point about the effect of Government borrowing, given the stage that we have reached in the economic cycle. I shall return to that point later if I may.
	The hon. Member for Luton, North (Mr. Hopkins) made a thoughtful—in some respects helpful, from our point of view—speech, and I commend him on his determination to see the Bank of England remain independent. If he wants that to become a certainty, I   would encourage him to vote Tory at the forthcoming general election, because if he votes Labour, he will condemn the Bank of England to precisely the opposite fate.
	We then heard from my hon. Friend the Member for Worthing, West (Peter Bottomley), who made an important point about the decline in the savings ratio. He also had some helpful advice for the National Audit Office about removing the plank from its own eye, as it were, in regard to wasteful spending. I am sure that the NAO will take his remarks on board. He also chided the   Chancellor and the Prime Minister for quite deliberately carrying on a conversation when my right hon. Friend the Leader of the Opposition was replying to the Budget statement. Hon. Members will recall that the Labour party embarked on something called the big conversation last year. We have not heard much about it since then. It seems to have been overtaken by another conversation between the Chancellor of the Exchequer and the Chancellor of the Duchy of Lancaster. That is a   very lively conversation indeed, and it is often conducted in very short bursts.
	There has been virtually no conversation whatever between the Prime Minister and the Chancellor during that period, hence the Chancellor's famous quotation as to the Prime Minister,
	"there is nothing that you could ever say to me now that I could ever believe".
	That is not the basis for running an effective Government, so I think my hon. Friend has hit on an important point, over and above the points on which he was offering advice to the Government Chief Whip, and we thank him for that.
	We then had a contribution from the hon. Member for Edmonton (Mr. Love), who is back in his place and whom I would not want to disappoint. He attacked the independent forecasters for having the temerity to disagree with the Chancellor's forecasts—I shall say more about that in a few minutes—and also referred to our proposed savings of £35 billion arising from the James review.
	May I make this absolutely clear to the hon. Gentleman and to all those who are listening? From that exercise—the £35 billion we have identified—we intend to reinvest in key public services £23 billion. That leaves £12 billion. We will devote £8 billion of that to plugging the black hole, which will leave £4 billion for measured tax cuts, of which we have deployed £1.3 billion so far in offering our discount to council tax payers over the age of 65. That is the £35 billion that we are talking about. I have explained to him in crystal clear terms what we intend to do with it.

Andrew Love: Will the hon. Gentleman give way?

Mark Francois: Yes, I have been waiting for this.

Andrew Love: I thank the hon. Gentleman for giving way.   When I tried to get on to the Conservative party James review website, I got a wonderful picture of Mr.   James and nothing else. Can the hon. Gentleman please tell us where the cuts will hit in the £35 billion, because the website does not?

Mark Francois: Those plans have been on the website for several weeks, and I am sorry if the hon. Gentleman had trouble getting through to it today. If he is having trouble with websites, he might want to have a quiet   word with the hon. Member for Rhondda (Chris   Bryant), because he knows quite a bit about that sort of thing. I am sure he could advise the hon. Gentleman on how to do it.
	Moving on, we heard from my hon. Friend the Member for Upminster (Angela Watkinson), who spoke knowledgeably about children's centres and how they have been changing in the past couple of years. She   also highlighted problems in relation to the administration of tax credits. Ministers know that we have had lively debates about that over the past couple of months, not least when we were discussing the proposed merger of the Inland Revenue and Her Majesty's Customs and Excise.
	There is still a definite problem in the administration of tax credits and child tax credits, and my hon. Friend is right to raise it. There is considerable frustration out there in the country over this matter, and she will be delighted to have it reiterated that our policy is to declare an amnesty for the overpayment of those credits in the current financial year so that we can audit the system completely and move on into the new financial year with a fresh start.
	That will remove the misery, which many people have experienced, of getting two letters on the same day—one saying there has been no overpayment and one saying there has and demanding that that money be paid back.   People clearly deserve better than that from any Government, and I hope that that advice is reassuring to my hon. Friend and her constituents.
	We then heard from my hon. Friend the Member for Fareham (Mr. Hoban), who went through a forensic analysis of the Government's system of public service agreement targets. I know from experience that he is a good man to have read a document in fine detail, and he has proved that again in the House this evening. I look forward to finding out whether Ministers have anything to say in reply to the charges he put to them.
	One of the most worrying aspects of the Budget is that it fails to address the serious black hole in the public finances. Despite all the brave words about never taking chances with them, the Red Book represents a fiscal tightening of just over £250 million, which does virtually nothing to plug the black hole that persists at the heart of the Chancellor's finances.
	Almost all the major independent economic forecasters—the Organisation for Economic Co-operation and Development, the International Monetary Fund, the Institute for Fiscal Studies, the National Institute of Economic and Social Research and the ITEM Club, which uses the independent Treasury economic model—agree, and all concur that the black hole exists to the point that, if Labour was somehow to be re-elected, the inevitable consequence would be major tax rises to try to fill that hole.
	As David Smith noted in The Sunday Times yesterday:
	"For Brown, part of the aim of last week's budget was political, though mostly it was to focus attention on the long-term challenges facing Britain. But he also hoped to bury doubts about the public finances and switch the spotlight to Tory plans. In that respect the Budget was a failure".
	The Chancellor and his allies like to claim that he has an impressive record for forecasting. That is half wrong and half right. His growth forecasts have indeed tended to be accurate, but his deficit forecasts have been just the opposite, and have increased by some £6 billion since the last Budget alone. The Chancellor is now projected to run a Budget deficit of some £34 billion this year, and over the next six years combined that amounts to an eye-watering £168 billion of expenditure over revenue, even without including all the off balance sheet debt. Therefore, whatever his record on forecasting growth might be, the emperor has no clothes when it comes to forecasting accurately the state of the public finances.
	Another thing that we have learned about the Chancellor's Budgets is that we always need to read the   small print. When we do so, it provides some fascinating information. For instance, his council tax discount applies only for one year. Page 187 of the Red Book shows clearly that it applies in 2005–06, but the corresponding figures for 2006–07 and 2007–08 are zero. It is therefore a one-off bribe designed purely to get Labour through the election, whereas our discount of 50 per cent. off a household bill up to a maximum of   £500 per household is for multiple years, not just one. No wonder The Sun responded to the Chancellor's Budget the following morning with the headline, "Beware the bribes of March".

Desmond Turner: Will the hon. Gentleman give way?

Mark Francois: In a moment.
	Last Wednesday, when the Chancellor announced the so-called free bus passes for pensioners—which we have said that we would honour, like the council tax discount—he told the House that there would be
	"free local bus travel for every pensioner and every disabled person too."—[Official Report, 16 March 2005; Vol. 432; c. 269.]
	He neglected to mention, however, that that applied only to off-peak travel, and that it already exists in several major parts of the United Kingdom, including Scotland, Wales and London. In addition, as confirmed in the Red Book, the measure only comes into operation from April 2006. Therefore, for those who live in Scotland, Wales or London, for those who want to travel early in the morning or for those whose journey is so urgent that they need to make it before April 2006, it is not quite the election sweetener that they might have been led to believe. I now give way to the hon. Gentleman, but only on the condition that when he asks his question he also slips in an explanation of the operation of post neoclassical endogenous growth theory in a mixed economy in the 21st century.

Desmond Turner: I do not give the hon. Gentleman that promise. I simply want to ask him why he thinks that   Gordon's offer of a £200 discount to pensioners in   respect of council tax is a bribe, whereas the Conservatives' offer of a £500 discount is not a bribe.

Mark Francois: Obviously, the hon. Gentleman is on first name terms with the Chancellor of the Exchequer. The difference is that Labour's proposal is for one year only to get it through the election, whereas ours is a multi-year commitment, and not a bribe but a rolling programme. That is the answer to his question.
	The British people have been offered a vote now, pay later Budget. They can vote if they wish for a high-taxing Labour Government who would almost certainly have to raise taxes, were they to win the general election, in order to address the black hole. In contrast, nothing in   the Budget makes any difference to our tax and spending plans. We will implement the changes announced in the Budget, including the council tax payment to pensioners, free off-peak bus travel and increasing the stamp duty and inheritance tax thresholds. The British people can vote now and pay later with Labour, or vote Tory and avoid having to pay more. That is the choice to carry into the general election campaign, and as our leader said directly to the Prime Minister, "Bring it on."

John Healey: This has been a good debate. I have counted 19 Members who have contributed, including the hon. Member for Rayleigh (Mr. Francois), and I will pass on his kind comments about the Chief Secretary to him.
	At the heart of this Budget statement has been the Chancellor's confirmation that the UK is enjoying the longest period of economic growth and stability since records began. While every other major developed country experienced at least one quarter of negative growth in the recent world downturn, Britain did not. Instead, Britain is the only G7 economy to have grown in every quarter since 1997. In 2004, we saw the economy grow by more than 3 per cent. for the second year running. That was exactly in line with the forecast that we first made two years ago. We entered 2005 with the same growth forecast of between 3 and 3.5 per cent.   On Thursday, the hon. Member for Havant (Mr.   Willetts) paid tribute to the Chancellor's forecasting accuracy, saying
	"The Chancellor's forecasts for economic growth have indeed turned out to be much more accurate than those of outside City forecasters."—[Official Report, 17 March 2005; Vol 432, c.421.]
	We have also seen the economy become more balanced, with increasing investment, strong export growth and the fastest rate of growth in manufacturing for four years.
	Stability is not just a concern for economists—it helps families, it helps business, it helps Governments to plan for the future. It also reduces costs, because it leads to lower inflation and lower interest rates. Britain has simply not been used to the stability that we have seen   in the economy since 1997. Between 1979 and 1997 Britain was the least stable and most volatile—rather than the most stable and least volatile—economy in the G7. During those 18 years under the Tories, the inflation rate was double the rate since 1997. Interest rates had doubled, millions were consigned to negative equity, and unemployment hit 3 million not once but twice. Since 1997 inflation has been the lowest for 30 years, interest rates are the lowest for 35 years, employment is the highest ever, and living standards have risen by an average of 3 per cent. every year in the last eight years under a Labour Government.
	A strong economy is the basis for sound public finances. Since 1997, no G7 country has had lower debts   and deficits than the United Kingdom. We have established and are meeting strict fiscal rules, and the Budget sees no relaxation in that fiscal discipline. Since the pre-Budget report in December public finances have strengthened, as we expected. Tax receipts are on forecast and unemployment costs continue to be low, as do Government debt and the interest rate on it. For the remainder of this economic cycle and the next, while continuing to invest in public services and infrastructure we will also continue to observe our fiscal rules.

Desmond Turner: My hon. Friend referred to stability. Would he care to contrast the record of business failures under the pre-1997 Government with the present Government's record, and the number of successful start-ups under this Government?

John Healey: I am not sure whether my hon. Friend heard what I said earlier. Stability is important not only to families and Government, but to business. Not just steady growth but stability in the economy has been a major factor in the present state of affairs: we now have 300,000 more businesses in Britain than we had in 1997.
	It was a pleasure to hear my former Treasury colleague, the new Secretary of State for Education and Skills, set out the imperative and the plans for investment in education and skills. The work done jointly by her Department and the Treasury is strong, which last week's Budget underlined and which tomorrow's skills White Paper will also underline.
	My hon. Friend the Member for Norwich, North (Dr.   Gibson), who is recognised in all parts of the House as one of its foremost authorities on science, identified the elements of the Budget—such as the boost for stem cell research—that will help our science base. He also spoke of the way in which innovation, invention and intellectual property need to be developed and transferred to business activity.
	The hon. Member for Harrogate and Knaresborough (Mr. Willis) welcomed the Budget, which he described as brimming with extras for education. I am pleased about that. The hon. Gentleman has lost none of the passion, inspiration and ambition for education that he had as a head teacher: eight years in the House of Commons have not dimmed any of that. He asked two   principal questions: how the plans for capital investment in primary schools will be prioritised, and whether voluntary-aided primary schools will fall within that capital programme. The answer to the second question is yes, but as he will appreciate the answer to the first needs more consultation and is likely to be set out by the Secretary of State in detail in due course. However, she was with me when he made his contribution, and she was listening carefully.
	As the hon. Gentleman pointed out, he and I both spoke at this year's Association of Colleges conference in Birmingham; indeed, I suspect that we spoke at last year's conference as well. We are both strong supporters of further education, which offers a breadth of learning to a range of learners that is simply unmatched by any other part of the education system. I am pleased that he welcomes the Budget boost to the capital infrastructure of, and plans for, FE—a point that my hon. Friend the Member for Coventry, South (Mr. Cunningham) also stressed.
	My hon. Friend the Member for West Bromwich, West (Mr. Bailey) rightly identified the low skills base and the need for more science and research in his constituency—issues that are also at the centre of the future economic challenges that this country as a whole faces. We want families to open the child trust funds that he talked about, but if they do not the Inland Revenue will do so for them, so that no child will miss out on investing the money provided by the Government. As he suggested, we will also look at ways in which new parents can get information about the child tax credit.
	My hon. Friend the Member for Brighton, Kemptown (Dr. Turner) clearly goaded the Conservatives, who intervened on him more times than they did on anyone else. He made the very fair point that on listening to them, one would imagine that their £35 billion-worth of cuts was somehow dreamt up by Labour. That is not our claim but it is their commitment: it is set out on the record, repeatedly, by the shadow Chancellor. My hon. Friend the Member for Coventry, South made it clear that he and his constituents know that, as sure as night follows day, cuts come with a Conservative Government. That was a warning to the whole House and to the country as we approach a possible general election.
	My hon. Friend the Member for Hartlepool (Iain   Wright) made an incisive first speech in a Budget debate. He reminded the House of how hard his home town was hit by the Tories—by a Government who mismanaged the economy and drove it into recession not just once, but twice. It is working-class families and towns, and areas such as his in the north-east, that bore the brunt of past economic failure and mismanagement.
	My hon. Friend the Member for Luton, North (Mr.   Hopkins) put on the record his congratulations to the Bank of England for its management of monetary policy. That will be both welcome and a surprise to the Governor of the Bank of England, who is not known for being a proponent of that policy. But my hon. Friend then took apart very effectively the myths promoted by the Conservatives, and he rightly stressed that the fundamentals of the British economy are strong.
	My hon. Friend the Member for Edmonton (Mr.   Love) developed that theme and in doing so reflected his regular service on Finance Bills and his close following of Treasury matters. He rightly said that what clearly sticks in the Conservatives' craw is giving credit to a Labour Chancellor for the successful management of the economy. My hon. Friend also reminded us that the Conservatives somehow regard the past eight years as being down to the economic legacy of the last Conservative Government. It is easy to get an economy moving again after a deep recession such as that experienced in the early 1990s, when there was the fiasco of sterling crashing out of the exchange rate mechanism; the hard part is putting in place the policies to sustain that growth, along with low inflation, low interest rates and high employment.
	It is also worth remembering that in 1997 interest rates were higher, unemployment was higher, debt was higher, the last Conservative Government were spending more on servicing government debt than on education, and inflation was back in the system. That was the legacy that this Government inherited from the last one.The hon. Member for Fareham (Mr. Hoban) constructed a rather lengthy argument about public service targets, information capture and inspection. I   have to tell him that, frankly, it is wishful thinking to believe that his party can somehow find £35 billion-worth of savings from spending on such measures. If the hon. Gentleman sacked every single civil servant in this country, it would save just £20 billion.

Mark Francois: Let us nail this £35 billion once and for all. As my right hon. Friend the shadow Chancellor said in The Guardian this morning, our spending plans involve
	"no cuts to nurses, doctors, teachers or police."
	The ITN reporter Nick Robinson completely middle stumped the Prime Minister on this matter last Thursday, so Ministers should stop repeating the assertion, which is based on desperation resulting from the canvass returns that Labour Members are receiving in their constituencies.

John Healey: If the hon. Gentleman reads the record, he will see that that is not what I said. I am providing the House with an indication of the huge scale of £35 billion-worth of savings in Government spending and pointing out that deep cuts will inevitably follow if any Government set out on that path. [Interruption.] I   shall return to the issue in a few moments.
	The hon. Member for Upminster (Angela Watkinson) expressed genuine concern about early years provision. She is right about the wide range of needs that parents and children have. I was pleased to hear about the success of the Sure Start programme at Harold Hill in her constituency, but I have to say that I   do not recognise the figures that she provided on so-called cuts in child care places. There has been a net increase, confirmed in the 10-year child care strategy published alongside the pre-Budget report in December, of 525,000 places in a wide range of child care settings, including nurseries and the provisions of child minders before and after school clubs—precisely the sort of provision that the hon. Lady urged on us.
	The hon. Member for Worthing, West (Peter Bottomley) has been in the Chamber for most of this afternoon, but is not in his place now. I recognise his long-standing membership of the Transport and General Workers Union and pay tribute to the fact that it was he who first mentioned in today's debate the support that the Government are providing for union skills and learning, and, in particular, for the new union learning academy, which my right hon. Friend the Chancellor announced in the Budget last week. He asked about commercial stamp duty, disadvantaged areas and the operation of film tax relief. I wanted to tell him that the answers to his questions are set out in the Budget press releases, but if he cannot find them, I   would be happy to provide further details.
	In common with the hon. Member for Rayleigh, I like to recognise, if I have time, the contributions of all hon. Members who speak in a debate. I have to admit, frankly, that the hon. Member for New Forest, West (Mr. Swayne) had me stumped. The House did learn, however, that he taught A-level economics and that he reckons to be able to get an attentive Labrador through the exams. I take that less as a commentary on the Budget than as a bid for a Front-Bench job in the shadow Treasury team.

Desmond Swayne: Will the hon. Gentleman give way?

John Healey: If the hon. Gentleman will forgive me, there are other hon. Members on both sides of the House who made contributions and I want to pay tribute to them.
	The hon. Member for Boston and Skegness (Mr.   Simmonds) criticised the Government on the management of the economy and jobs performance, despite the fact there are 2 million more jobs in the British economy than there were in May 1997. May I ask him to take care? Unemployment in his constituency is down by 673 since the last election—150 more than his majority.
	The right hon. Member for North-West Hampshire (Sir George Young) made a curious plea at the outset for more bullet points in the Budget. He then went on to suggest that the standard rate of income tax is the thermometer by which the Budget and the Government are judged. May I remind him that the Chancellor's Budget last week raised the child tax credit? Also, as a result of the announced rises, the new system of tax credits, offsetting income tax liabilities, means that the effective rate of income tax for a family with two children, collectively earning £25,000 a year, is 6 per cent.—not 22 per cent., which is the basic rate of income tax, but 6 per cent. The effective rate of tax for a family on £30,000 with two children will be 10 per cent.
	The right hon. Gentleman also expressed concern about higher spending on the NHS being eaten up by increases in the drugs budget. Efficiency savings in the drugs budget last year led to savings of £370 million, and for this year, next year and the following years the target is for efficiency savings in the drug purchasing budget of £1 billion.
	The hon. Member for Ruislip-Northwood (Mr. Wilkinson) made a reflective but characteristically right-wing speech. As he considers leaving the House, which he entered in 1970, we wish him well. I am sorry that he   did not find the Budget exciting, but as the CBI said, it was a measured Budget and in many ways provides the   continuity and stability that the British economy needs. The Chancellor has made it clear that he will do nothing to put that stability at risk, but the further challenge is to lock in our economic success and stability for the future. That means securing the high levels of capital investment, innovation and science, technology, business support and skills that our economy needs for sustained improvement in productivity and prosperity.
	Let us look at the shadow Chancellor's plans. The medium-term expenditure strategy is the basis for his economic credibility. In that strategy, he said that he had
	"agreed with my Shadow Colleagues that the baseline for spending across all of these departmental budgets will be 0% growth for the first two years except for schools and the NHS . . . across the cycle, public spending will grow by about 1% more slowly than the Treasury view of trend rate of nominal GDP growth".
	A cash freeze means that cuts will be necessary from day one. We should take the shadow Chancellor at his word:   a cash freeze imposed across Government on all Departments apart from those he specifically excepted. That means cuts not just in the essential public services on which many people depend, but in the investment essential to secure the long-term stability and success of the economy—in skills, training, science, research, business support and enterprise.
	When the shadow Secretary of State for Education and Skills was asked by the Secretary of State if he would match our extra spending on skills, modern apprenticeships, further education and Sure Start, the hon. Gentleman said, "Yes"—not from a sedentary position; he rose to the Dispatch Box to say, "Yes". The House heard one of two things from the shadow Secretary of State at that point. Either we heard a new contradiction and confusion about what the Tory Front-Bench team will spend and what it will cut, or we heard the shadow Secretary of State for Education and Skills make a new spending commitment that the shadow Chancellor has not made. I invite the hon. Gentleman to confirm whether the shadow Chancellor has agreed to the announcement that he made at the Dispatch Box this afternoon. Yes or no?

Tim Collins: Yes, the shadow Chancellor agreed to what I said. What my right hon. Friend said after the publication of the James report overtakes and replaces what was said at the time of the quotes the Minister used. I suggest that he gets his Labour party research officers to update their files.

John Healey: This is an interesting conclusion to our debate. It takes the Tory spending plans and their whole claim to economic credibility further into the realms of fantasy—[Hon. Members: No, no."] It does, because it means that the year-on-year cuts and the £35 billion that the shadow Chancellor is committed to achieving must come from less and less credible sources, from fewer and fewer areas of Government spending. If the Tories want to be taken seriously on that, they must explain where they will make the year-on-year cuts in our spending plans to find the £35 billion public investment cuts that the shadow Chancellor has confirmed and described as vast figures.

Desmond Swayne: The hon. Gentleman need not speculate; all he need do is read the book—it has all been published in the James report.

John Healey: Is that the same James report that double counts the £21 billion that we have already set aside and plan to reinvest under the Gershon review? Is that the same James report that claims that more than £600 million can be saved by abolishing the strategic health authorities, when the cost of running the SHAs is only £130 million? Is that the same James report that claims that £100 million a year can be saved by privatising the driver, vehicle and operator group test, when that was privatised by the Tories in 1996? Instead of adding to, that undermines the credibility of the shadow Chancellor and a future Tory Government.
	Let us be clear. The shadow Chancellor has said:
	"Our plans provide the ability over a six-year period for us to be spending about £35 billion less per year in the sixth year than Gordon Brown's plans provide for".
	That means year-on-year cuts in spending plans from year one. Based on the shadow Chancellor's own figures, under his plans there would be £7.5 billion in cuts next year; £13 billion in cuts the following year; £16 billion the year after; £22 billion the year after; £27.5 billion the year after; before reaching £35 billion after six years. That is the reality of what this country would face if we get a Tory Government committed to that sort of scale of cuts.
	Instead, the Budget is built on the strength and stability in the economy. It strikes the right balance between tax cuts that are affordable, investment that is essential and stability that is paramount throughout. It is not a give-away Budget—in fact, there is a marginal tightening of the public finances, as several hon. Members have recognised in their speeches—but it is a pre-election Budget: it sets out the choice facing people if and when the Prime Minister calls an election.
	People have a choice to consider: the track record, priorities and experience of 18 years under the Conservatives and eight years with Labour. A period under the Conservatives when inflation was 6 per cent. on average; a period with Labour when it has averaged 2.4 per cent. A period under the Tories when interest rates averaged 10.5 per cent., and with Labour less than half of that. A period under the Tories when mortgage rates for families averaged 11.5 per cent., or a period with Labour when they have averaged 6.1 per cent. for eight years.
	Since 1997, while 2 million children and almost 2 million pensioners have been lifted out of the condemnation of living in absolutely poverty, we have seen living standards rise, on average, by 3 per cent. each year, and Britain today has the best combination of low inflation, high employment and rising living standards for a generation. There will be a choice at the next election: a choice of Labour with more help for pensioners, children and working families, with most help targeted on those who need it most; or the Tory party, with a threat to tax credits and the pension credit. We know from the past that the Tories leave poor, low and middle-income families worse off.
	The choice is between a Labour party and Labour Government who will continue to invest in essential public services and to meet the long-term economic challenges that Britain faces, or a Tory party that is pledged to spend less in each and every year and to cut £35 billion from the public spending plans and from the investment that we need for our economic future. The choice is between a Labour Government who, for eight years, have run the economy to provide 2 million more jobs in Britain, 300,000 more businesses, 150,000 more self-employed people and 1.5 million more home owners; or a Tory party that is pledged to make the same short-term decisions and the same mistakes with the economy as they made before. The Tory party risks returning Britain to the stop-go economy that we saw before—the stop-go economy that brought to British families higher mortgages, higher inflation and higher unemployment. I end, as did the hon. Member for Rayleigh, by quoting his leader: "Bring it on."
	It being Ten o'clock, the debate stood adjourned.   Debate to be resumed tomorrow.

PETITION
	 — 
	Judicial System

Jeremy Corbyn: I wish to present a petition on behalf of Dick Lucien Chitolie, a constituent of mine, and Christine Elaine Hanson.
	The petition declares:
	That both petitioners are victims of the judicial system and its attached establishments, which have denied the petitioners their rights and access to justice by ignoring Acts of Parliament that the petitioners specifically relied upon.
	The Petitioners therefore request that the honourable House of Commons pass legislation to make provision for new procedures which ensure the protection of innocent witnesses and jury members in court cases, the independence of the judiciary and the right of the subjects to appeal.
	And your Petitioners remain truly.
	To lie upon the Table.

LAW SOCIETY (COMPLAINTS)

Motion made, and Question proposed, That this House do now adjourn.— [Mr. Ainger.]

Nigel Beard: I   welcome Sir David Clementi's final report on legal services in England and Wales and I was pleased to hear of the Lord Chancellor's speech today at the legal services reform conference where he announced the future establishment of a legal services board and an office for legal complaints. Such a large reform and liberalisation of legal services cannot happen overnight and I therefore want to draw attention to structural deficiencies in complaints handling by the Law Society that need to be addressed immediately. The case of my constituents, Mr. and Mrs. John Andrews makes it clear how urgent and necessary that improvement in complaints handling has become. I realise that the Minister will be unable to comment on the specific details of the case, but it shows the background of my general points about the Law Society's performance.
	At the beginning of 1995, the late Mrs. Patricia Andrews of Welling in my constituency, realising that she was critically ill with cancer, instructed Ms Gill Scott, a solicitor with a local firm, Woolsey, Morris and Kennedy, to arrange her will. The executors were to be a family friend, Mr. Heaton-Smith and the solicitor, Ms   Scott. The estate was to be passed into trust, primarily for her son, Mr. John Andrews.
	Mrs. Patricia Andrews died on 7 June 1995. What followed was three years of delay, poor service, unsatisfactory decision-making and possible misconduct by Ms Scott, all of which resulted in huge financial loss to the estate and years of distress for Mr. Andrews. Ms Scott was finally removed as co-executor by the High Court in March 1998. Sadly, that was not the end of the affair because, some seven years later, the new executors are still trying to recover the financial losses and the estate cannot be released.
	This was not a complex probate case. There were some savings, some shares and two properties, one with a disputed mortgage, all to be transferred into a discretionary trust. It is difficult to understand why there were six-month periods of inactivity and why so little had been achieved at the time of Ms Scott's removal as executor.
	Ms Scott failed to keep accurate accounts and did not know the estate's value when she was removed. She was guilty of misconduct in transferring £500 from the client account to the office account without first rendering a bill. She broke practice rule 15 in failing to provide a letter containing her charging policy, which might have avoided the dispute over costs at a later stage. In fact, she continually failed to provide cost information and at the time of her removal as executor the administrative costs of handling probate amounted to £10,800, compared with an original oral quote of £900.
	Perhaps Ms Scott's most serious error related to one of the properties in the will. The late Mrs. Andrews had transferred a mortgage in the 1980s from an endowment policy to a repayment mortgage, only to find out some 13 years later that the building society had never made the transfer.
	The building society admitted liability and made a generous offer of a £15,000 interest-free mortgage. Both the lay executor, Mr. Heaton-Smith, on the advice of independent solicitors, and Mr. Andrews were happy to settle. However, Ms Scott decided that the estate should litigate. Sadly, the case was lost, resulting in the estate being required to pay both sides' litigation costs and a full mortgage of £22,500. Plainly, there was a conflict of interest, with Ms Scott as executor instructing her own firm to litigate and the resultant income that it gained from the case. As a direct result of Ms Scott's behaviour, the estate was required to pay a total of £40,000 plus interest, rather than the £15,000 interest-free mortgage that had been offered.
	Ms Scott did not fulfil her oversight obligations to the   property in question, 56 Colmer road. The tenant repeatedly complained about the state of the property, but Ms Scott procrastinated about funding the repair work. In the end, the estate was forced to sell to pay for the now extensive repairs and associated litigation by the tenant. If only Ms Scott had inspected the property when Mrs. Andrews died and paid for the then minor repairs, that could all have been avoided.
	In summary, Ms Scott was intransigent, made a catalogue of mistakes and did not administer the estate properly. As a direct and indirect result of the decisions she took, the cost of handling probate amounted to £35,000 more than it should have done. However, as my summary implies, the total costs were much greater than that. In being forced to sell the house, Mr. Andrews lost the value of the property, he lost future rental earnings and, thus, the investment potential from other buy-to-let properties. A conservative estimate of his loss would be some £500,000. Furthermore, Mr. and Mrs. Andrews could not draw on the residual estate value to aid them when their business and livelihood experienced serious financial difficulties. This affair has had a cataclysmic effect on the Andrews' lives.
	I turn now to the handling of the consequent complaint by the Law Society. Mr. Andrews first complained in 1999. Ms Scott immediately submitted a formal bill for taxation proceedings, effectively a stalling tactic as the Law Society refuses to continue an investigation while court proceedings are under way. The second stage began almost two years later in December 2001, when Mr. Andrews came to see me at one of my surgeries. He and I wrote to ask for the file to be reopened, and that is when the endemic pattern of delay at the Law Society became apparent.
	First, there was uncertainty over whether the Law Society would investigate. Then the local conciliation officer took three months to submit his formal report. That meant that it was four and a half months before the investigation stage even started. The investigation started in July 2002. It did not conclude until December 2003. It is a disgrace that such a complaint should take 23 months to be concluded, even if one accepts the Law Society's original rejection of the complaint. When the report was published, it was four years and one month after the moment the complaint was first raised.
	In 2000, Professor Richard Moorhead of Cardiff university produced a very comprehensive report on complaints handling, commissioned by the Law Society, entitled "Willing Blindness?". It did not pull any punches. Professor Moorhead found that persistent and pervasive delay
	"is in many ways the defining characteristic of the organisation".
	Although that quote is from 2000, my constituents' experience through to late last year suggests that very little has changed.
	Another significant issue for my constituents was the Law Society's artificial distinction between inadequate service and professional misconduct, which Sir David Clementi highlights. The Andrews could ask for misconduct to be investigated, but not inadequate service, as neither Mr. Andrews, the beneficiary, nor Mrs. Andrews, the new executor, were clients of Ms   Scott. That raised the absurd situation whereby, in the eyes of the court, the Andrews are the clients and should pay, but in the eyes of the Law Society, they are   not the clients and therefore can receive no compensation and very little protection.
	Mr. Andrews was also frustrated by the lack of transparency. At the moment, no one can ring to find out whether a complaint has been lodged against a specific solicitor. That means that we have no idea whether Mr. Andrews's complaint is an isolated example or whether there is a pattern of mistreating clients in the firm.
	To finish with the most serious element, it seems that the major fault of the Law Society in this case is an apparent bias towards the solicitor and a lack of robustness in exacting punishment. Both may be due in part to the training of caseworkers. Mr. Andrews had four different caseworkers and there was a worrying lack of consistency. For example, the first caseworker never told Mr. Andrews that she would not investigate inadequate service on his behalf, whereas the second picked up on that straight away.
	"Willing Blindness?" highlighted many such concerns about casework and adjudication panels. It found that
	"For hybrid matters"
	—the combination of inadequate service and professional misconduct—
	"'spare' solicitor members tended to participate in discussion, regardless of whether they were formally allowed to vote".
	It also found
	"that caseworkers were simply accepting the solicitors' story in preference to the client's without calling for evidence which clearly existed."
	Even when the Law Society does find a solicitor guilty, little appears to happen. Ms Scott was found guilty of three complaints, yet she does not appear to have been punished or reprimanded in any way. From April to September 2004, after the rebranding of the consumer complaints service, only 5 per cent. of complaints were upheld with action taken. That tiny level of convictions makes it clear that the scales of justice are firmly tipped against the man in the street.
	Which?, formerly the Consumers Association, has repeatedly backed up the conclusions that I have drawn and supports an end to self-regulation. In its 2004 survey of solicitors, 71 per cent. of those who responded complained about excessive delays and 59 per cent. about negligence. More than 40 per cent. of those who said that they had received poor service failed to complain, which implies that the problem is even greater than the one in five solicitors who are complained against at present. Those who did complain did not feel   that they had fared much better. The legal ombudsman's annual report backs that up: she was satisfied with the quality of complaint handling by the Law Society in only 53 per cent. of last year's cases.
	As I said at the opening of my speech, the large-scale reform suggested by the Clementi report might take years to come about. I appreciate that that is why the Government took the responsible step of activating the legal services complaints commissioner. I am also very heartened by the Law Society's recent decision to set up a separate body for consumer complaints, with a lay majority. That is a positive step and I hope that this debate will inform its work.
	Nevertheless, I ask the Minister as a matter of urgency and in combination with the legal services complaints commissioner to bring pressure to bear on the Law Society to make some immediate changes. Those include:   eliminating the artificial distinction between inadequate service and professional misconduct; punishing infringements of practice rule 15 much more rigorously; making the process much more transparent by making both conditions on practising certificates and the complaints history against a firm a matter of public record; giving wider publicity to disciplinary findings; referring sanctioned solicitors to the solicitors disciplinary tribunal if they repeat an offence; and either making the adjudication panel minutes public or always allowing oral hearings.
	None of those changes can undo the financial loss and years of depression experienced by Mr. Andrews and his family, the second element of which has certainly been increased by the Law Society's unimpressive performance. The changes could aid some of the 17,000 members of the public who, on past experience, will complain about solicitors in the next year.
	Most people come into contact with the law on only a few occasions, and their depth of knowledge of procedure is shallow compared with that of lawyers. Their relationship must perforce depend on trust in a solicitor's competence. For whatever reason in the case of Mr. and Mrs. Andrews, that trust was unjustified. Such cases will inevitably arise, although every step should be taken to ensure that they are rare. The Law Society has a central role in ensuring that trust is justified by giving an objective reprimand to people whose standards of practice and behaviour fall below reasonable expectations of good faith and competence. The overwhelming weight of evidence, as exemplified by Mr. and Mrs. Andrews' case, suggests that the Law Society itself, through bias, obscurity and delay, has fallen below reasonable expectations of good faith and competence. I therefore urge the Minister to ensure that the findings of the Clementi report are implemented speedily and to take steps in the meantime to eliminate the most blatant inadequacies of the Law Society's present arrangements.

David Lammy: I am grateful to my hon. Friend the Member for Bexleyheath and Crayford (Mr. Beard) for raising this issue, and I express my sympathy for his constituents, who have clearly had a distressing experience.
	Since I joined the Department for Constitutional Affairs when it was formed in June 2003, my overriding aim has been to promote better public services, including legal services, that are designed to meet the needs of the people who use them. Individuals use and depend on the justice system and legal services as they go   about their everyday life. Mr. and Mrs. Andrews, for   example, used them to deal with the important legal   matters of a will and an estate. People who use   legal services are no different from other consumers, and are entitled to expect an excellent service from their provider. At worst, that service should be satisfactory. Most people go to a solicitor in times of tremendous stress—for example, when they are buying a house, when they are going through a divorce or dealing with the necessary paperwork following the death of a family member.
	As someone who was previously a lawyer, I know that this is bread-and-butter work for solicitors. For the individuals concerned, however, it is a vital matter that can have a devastating and lasting effect on the rest of their lives. Someone going through the stress of a divorce has enough to contend with. How much worse would the whole experience be if, at the end, they felt let down by their solicitor, whom they trusted to uphold their rights and protect their interests? I do not wish to suggest that the majority of solicitors in England and Wales are failing to provide an excellent service. Legal services in the United Kingdom are among the best in the world, and many countries look to us in these isles for the high standard that our legal community upholds. However, we all recognise that sometimes things do not go smoothly, and there has been a problem with the processing of complaints made against solicitors. That could undermine the esteem in which our solicitors are held.
	If things go wrong, consumers are entitled to expect that their complaints will be dealt with fairly and effectively. That is true whether the complaint is about a solicitor delaying sending out papers or is a matter of professional misconduct. To the consumer whose life has been affected, it does not matter whether the profession views the complaint as a minor issue or not. What matters to the consumer is that they are listened to and their concerns taken seriously.
	My hon. Friend referred to Sir David Clementi's final report on legal services in England and Wales. One of the key recommendations is the proposal for a single new complaints body. We will create an office for legal complaints that will be led by a board with a lay chair and a lay majority. This body will be simpler for the public to use and understand, and better able to provide quick and fair redress. It will ensure consistent, fair and professional handling of cases for all complainants. A single new complaints body should remove the need to distinguish between inadequate service and professional misconduct. That goes to the heart of my hon. Friend's remarks. It will provide for much greater transparency within the complaints system, so addressing the points that my hon. Friend raised.
	I am looking into the amount of compensation for complainants. I agree with the findings of Sir Stephen Lander, the Law Society's independent commissioner, in his 2003 annual report, that the current levels are too low. The Law Society has accepted Sir Stephen's recommendation that the compensation limit when people suffer at the hands of solicitors should be raised to £15,000. I can assure hon. Members that I am keen to implement that as quickly as possible.
	Of course, removing complaints handling from the professional bodies will in no way reduce their responsibility to ensure that their members operate to the highest professional and ethical standards at all times. I acknowledge the serious and constant efforts that the professional bodies make in this regard. The office for legal complaints will help. I believe that getting complaints handling right is of critical importance. The solicitor's role as the conduit between the public and the legal system is vital, but it will continue to work effectively only if the Law Society can ensure that its services are carried out to a high standard.
	Many people will already be aware of the history of complaints handling by the Law Society. Historically, hon. Members across the House have made representations to the Lord Chancellor's Department because of their concern about the handling of complaints. It was clear that the consumer was being let down. Decisive and immediate action was needed. That is why we took the step of using the powers in the Access to Justice Act 1999 to appoint a Legal Services Complaints Commissioner.
	The role of Legal Services Complaints Commissioner has been taken on by Ms Zahida Manzoor, the legal services ombudsman. Ms Manzoor's experience as ombudsman meant that she had the necessary skills to undertake the challenging role of Legal Services Complaints Commissioner. Ms Manzoor's unique knowledge of complaints handling in this field meant that she was able to hit the ground running and speedily engage with the Law Society on how they intend to improve their services.
	To ensure that Ms Manzoor is equipped to do the task, we granted her a range of powers. She can require the Law Society to provide information about the handling of complaints; conduct investigations into those complaints; make recommendations on how to improve performance; set stretching targets; require the society to submit a plan showing how it is going to handle complaints, for her approval; and impose a fine if the society fails to meet the agreed plans for improvements in complaints handling.
	I have regular meetings with Ms Manzoor and I know that she is already making good use of those powers. She has made recommendations to improve performance and has set performance targets that she believes are reasonable and achievable for the Law Society to meet. The targets represent a package that aims to achieve a balance between timeliness of response, appropriate quality of decision making and customer satisfaction. They are a step towards achieving effective and efficient complaints handling. The Legal Services Complaints Commissioner will keep the targets under close review. Naturally, she will act in the best interests of the consumer, but balance that with the Law Society's capacity to improve.
	I am pleased to report that the Law Society's performance is beginning to improve in several areas, but there is still some considerable way to go before it delivers an effective and efficient complaints-handling service. I am sorry that we did not achieve that for Mr.   and Mrs. Andrews. The Law Society has demonstrated its commitment by constructively engaging with the commissioner, responding to feedback and assigning resources to ensure delivery of the required improvements. The commissioner will publish her findings on the Law Society's handling of complaints in her first annual report, which is due to be laid before Parliament in July this year. I look forward to learning of the benefits that the collaborative actions of the commissioner and the Law Society will deliver for consumers.
	I spoke earlier about Sir David Clementi's report. The Government have broadly accepted his main recommendations concerning the regulation of legal services, complaints and discipline, and new business structures. That will form the basis of a wide-ranging programme of reform that the Government will introduce. Much of that programme will require legislation. Earlier today, my noble Friend the Secretary of State gave a public commitment that we will publish a White Paper on the proposed package of reforms this year. That will set out the proposals in detail as well as plans for their implementation. Furthermore, we will bring forward legislation to put these reforms in place.
	I congratulate my hon. Friend on initiating this debate, which raises yet again in this House the sad state of affairs that some of our constituents experience at the hands of lawyers who should provide a much better quality service. In the past 18 months, we have accepted the recommendations of Sir David Clementi and have moved forward in implementing them. We look forward to the day when we no longer have to discuss the, frankly, shoddy service that some of our constituents get from solicitors when they experience a divorce, have a problem with a will or probate or have difficulties when buying a house. In the meantime, I hope that my hon. Friend welcomes the changes that I have outlined.
	Question put and agreed to.
	Adjourned accordingly at twenty-nine minutes past Ten o'clock.